Testimony: Scrushy Left HealthSouth In a Mess

BIRMINGHAM, Ala. (AP) - A corporate restructuring expert says Richard Scrushy left HealthSouth Corp. in a mess after investigators uncovered a massive fraud at the Birmingham-based rehabilitation company.

A judge heard deposition testimony from turnaround specialist Bryan Marsal on Thursday in a civil lawsuit against Scrushy. Shareholders who sued on behalf of HealthSouth are seeking $2.6 billion from Scrushy, whom they blame for the accounting scandal.

Scrushy denies any wrongdoing, and he was acquitted on criminal
charges in the fraud in 2005. He was later convicted in a separate
case and is serving seven years in federal prison.

Marsal said HealthSouth had no internal controls when Scrushy left in 2003. He said the company was in the worst shape of any he's ever seen.

(Copyright 2009 by The Associated Press. All Rights Reserved.)


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