MUNCIE — A troubled former vision center on Muncie’s west side has sparked yet more legal action.
A local ophthalmologist has sued the former owners of the Eye Center on Tillotson Avenue, alleging they committed securities fraud by fooling him into thinking the business was profitable — and accepting his investment of more than $500,000.
The lawsuit from eye doctor Michael Scanameo was filed in Delaware Circuit Court 4 against IU Health as successor to Cardinal Health Ventures.
IU Health/Cardinal, in a response recently filed with the court, denies Scanameo’s allegations and argues that the Eye Center Group was “significantly” hurried toward its demise due to thefts by a former officer who pleaded guilty to theft in 2012 and sentenced to prison.
“To the extent plaintiffs suffered damages, such damages were caused or contributed to by the conduct of parties other than Cardinal or by the conduct of non-parties,” IU Health/Cardinal argues in its response. “Such damages, if any, are not recoverable from Cardinal.”
The Eye Center as it had existed went out of business in 2009, according to an earlier lawsuit, and has, for the past several years, been under the ownership of American Health Network. The controversy the facility has generated predates that change in ownership.
The eye care practice has been the subject of as much controversy in the local business community as any venture in recent years. Former Eye Center executive Frank Winconek pleaded guilty to stealing more than $77,000 from the Eye Center. He faced justice locally after briefly moving to Guam.
A former partner, Jeffery Rapkin, sued the Eye Center in 2009 over his million-dollar investment. The lawsuit was subsequently dismissed. In his lawsuit, Rapkin said the Eye Center at the time had $21 million in debt.
The ripple effect from the Eye Center fiasco spread to other businesses. In 2009, The Star Press reported that Muncie-based First Merchants Bank’s loss of $31.2 million was likely attributable in part to a bad loan made to the Eye Center. First Merchants wouldn’t confirm the nature of the loss other than to say $10.2 million, the single largest loss, could be attributed to “fraudulent financial statements provided by a large commercial and industrial borrower.”
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