Doña Ana County and Las Cruces sue Memorial Medical Center, allege breach of lease and purchase agreement

Doña Ana County and the City of Las Cruces jointly filed a lawsuit this morning in the 3rd Judicial District alleging that Memorial Medical Center and LifePoint Health breached a lease and asset purchase agreement executed in 2004.

“For the past 18 months, we have worked in good faith to address concerns related to our agreements with Memorial Medical Center and LifePoint,” Manuel Sanchez, chairman of the Doña Ana County Board of County Commissioners, said at a news conference. “This is not a step we take lightly.”

Mayor Eric Enriquez said the filing was necessary because the county and city were unable to secure the performance they expected under the contract. “As of this morning, the city and county have jointly filed suit in the 3rd Judicial District here in Las Cruces against Memorial Medical Center for the breach of contract,” Enriquez said, adding that while many frontline staff “are doing their best,” the executive leadership and management have failed to meet obligations.

Las Cruces City Manager Ikani Thao Maopayao said the city served a demand letter about 18 months ago listing seven areas of noncompliance and that, while some progress occurred, the city remained unsatisfied with five of those items. “We are specifically concerned about the lack of indigent care and the shortfall on capital improvements,” Maopayao said.

Doña Ana County Manager Scott Andrews said the county issued formal notices requesting documentation and corrective actions and sought a third‑party review that was not permitted. “Throughout this process, we have issued formal notices outlining specific areas of concern related to compliance with the lease and associated agreements,” Andrews said, adding that requested documentation in some instances “has not been fully provided.”

County attorney Carrie Neal described the county’s request for an independent forensic audit of Memorial Medical Center’s books. “We offered to pay for that in its entirety. We offered to split it with them. But so far, LifePoint has refused to do that in a way that the city and county can know and understand that the audit is being done in a manner that is objective,” Neal said.

When asked whether the city and county could seek to remove Memorial Medical Center’s operator if a court finds a breach, a county representative replied, “The short answer to that question is yes,” noting that the contract allows the city and county to take the facility back if breach is found. Officials said that outcome was not preferred and that they remain open to a negotiated resolution if LifePoint and Memorial Medical Center come to acceptable terms.

The officials emphasized they were limited in what they could disclose because the matter is in litigation. Anita Skipper, communications officer for Doña Ana County, told reporters the governments would answer “what we can based on what's being shared today” but that there are limits tied to the legal process.

The city and county said they remain hopeful they can reach voluntary compliance but will pursue remedies “to the maximum extent allowed by law” if necessary. The news conference closed with officials saying they will provide updates as permitted by the court process.