Adeptus Health General Counsel Tim Mueller has seen good times and bad times. In fact, he saw both in a three-year period.
In 2015, Adeptus was experiencing phenomenal growth, going from 15 free-standing private emergency rooms in Texas in 2012 to about 120 of them in four states – plus five full-service hospitals – in 2015. The Lewisville-based company filed for an initial public offering in 2015 and debuted at $22 a share. Within a year, the stock price hit $100 and Adeptus’ market cap neared an astonishing $1 billion.
At an October board meeting, Mueller learned that cash collections had become an issue, even as more money was needed to build more facilities.
“Then the headwinds hit,” Mueller says. “The pace of growth was so vertical and we hit a liquidity wall. The company’s CEO had just retired and there had been other changes in senior management. There were real questions about what the landing would be like.”
Within months, Mueller and his team had hired Norton Rose Fulbright partner Lou Strubeck to advise the company on filing for Chapter 11 restructuring under the U.S. Bankruptcy Code.
In April 2017, Adeptus filed 140 bankruptcy petitions – one for each of its facilities in Texas.
“The way the old business operated, each ER facility was its own separate entity and had its own license,” Mueller says. “So, each had to be filed individually.
“There was a lot of blood, sweat and tears shed in order to be able to successfully restructure the business without impacting patient care,” he says. “The bankruptcy court made a point of noting that, and we were very proud of that effort.”
The bankruptcy restructuring and subsequent legal and business operations at Adeptus have been so successful that the Association of Corporate Counsel’s DFW Chapter and The Texas Lawbook are pleased to announced that Mueller is a finalist for the General Counsel of the Year Award for a Small Legal Department. The honor is part of the 2018 Outstanding Corporate Counsel Awards. The winners will be announced Jan. 24 at a major event at the George W. Bush Institute.
“Over the last 18 months, Tim successfully managed and directed the company’s internal and external legal operations during the restructuring of its financial and business operations and affairs,” says Strubeck. “The Adeptus bankruptcy involved 140 entities and constituted one of the largest – in terms of affiliated entities – enterprise bankruptcy cases ever filed.
“The bankruptcy cases, which were especially complex, contentious and time consuming, culminated in the reorganization of Adeptus’ business,” he says. “The success of the restructuring of Adeptus’ business under Tim’s management was extraordinary by any measure, as it is extremely rare for an operating company to emerge from bankruptcy. It was accomplished in less than 6 months from the commencement of the company’s bankruptcy cases.
“All of this was done through Tim’s dedicated and high-quality work with the rest of Adeptus’ senior management team to continue the company’s essential, day-to-day operations, within a highly government-regulated and fluid system,” Strubeck says.
Mueller, who is 42, was born in Philadelphia. His father was a police officer who was injured and moved the family to Houston when Mueller was four.
“My dad worked for law firms in Houston as an investigator and paralegal, which was probably my introduction to law and lawyers,” he says. “I didn’t have any big dreams of being a lawyer or becoming Perry Mason.”
After graduating from the University of Texas in 1998 with a bachelor’s degree in political science, Mueller went to law school at Southern Methodist University.
“I wasn’t sure what I wanted to do when I grew up, but I was pretty sure that law school and a law degree would help out,” he says.
Mueller worked for Dallas business lawyer Richard Gump part-time during law school and took a job with him working on business immigration matters, including business formations.
In 2006, Mueller joined Hiersche, Hayward, Drakeley & Urbach, an Addison law firm that specialized in representing small to midsized businesses, especially those involved in real estate development along the North Dallas Tollway.
“We basically served as outside general counsel to businesses that regularly had legal needs but were not big enough to have a full-time in-house lawyer,” he says. “The more corporate transactional work I did, the more I liked variety in the law. I like knowing just enough law to be dangerous. That’s when I started thinking about going in-house.”
Mueller spent four years as corporate counsel at Brink’s Inc., handling real estate legal matters for its U.S. facilities.
In 2012, executives for First Choice Emergency Room came calling.
“I was in my mid-30s, and I was looking for new challenges and high growth opportunities,” he says. “A private equity group had just bought the company and I was the first in-house lawyer and had the opportunity to build out the legal department.”
Mueller hired a lawyer to specialize in healthcare regulatory matters and another attorney to handle real estate transactions. For several months, Mueller engaged in intense negotiations with a real estate investment trust, which committed $400 million in investment to help the business grow.
And grow it did.
Mueller negotiated joint venture agreements with Texas Health Resources and other healthcare organizations in Arizona and Colorado.
Then came the IPO, which provided Mueller the opportunity to ring the opening bell on the New York Stock Exchange in June 2015.
Nineteen months later, Adeptus filed for bankruptcy.
“The whole restructuring process was eye-opening,” Mueller says. “It is amazing how expensive it is to go bankrupt, having to pay for all the experts and advisors.
“The great news is that, with a lot of work, we were able to exit bankruptcy,” he says. “Deerfield Health Fund was the key to giving us the money we needed to exit bankruptcy and to now move forward and grow.”
Strubeck gives Mueller the credit.
“Tim’s high level of competence and outstanding judgment, coupled with a tireless work ethic and positivity, were absolutely critical to Adeptus’ ability not only to exit bankruptcy in a remarkably short period of time, but to the on-going success of the reorganized business,” Strubeck says.