Mentzelopoulos: AHS, Government defence and plaintiff’s reply

Note: this post should be read in conjunction with “Smith, LaGrange, Alberta public service face grave test”  which examined the Statement of Claim brought by the former President and CEO of Alberta Health Services, Athana Mentzelopoulos against AHS, Adriana LaGrange and the Government of Alberta. In addition a Chronology of Events provides a detailed timeline based on the statements filed at the Court of King’s Bench. No allegations have been proven in Court.

The full Statement of Claim (SOC) is found below.

827797277-Statement-of-Claim-Mentzelopoulos

Government of Alberta (GOA), Adriana LaGrange Statement of Defence (filed 18 March)

The statement of defence (SOD) may be found below.  Health Minister LaGrange and the Government of Alberta are represented by Bennett Jones LLP (Munaf Mohamed KC).

2503-02991-Filed-2025-03-14-Statement-of-Defence GOA

The GOA defence rests on several claims that have not been proven in Court.

• Mentzelopoulos was never an employee of the GOA and therefore the GOA is not properly a party to the SOC (paras. 14, 58);
• The former CEO of AHS failed in her main duties  characterized as refocusing and transitioning her organization to fulfill the “democratic mandate” of the UCP government to review and reform health care delivery (Health System Refocus) in Alberta (paras. 7, 17-30, 12);
• Mentzelopoulos was so “infatuated” and “obsessed” with her investigations and suspicions that “she couldn’t do her job” (paras. 3-4);
• Mentzelopoulos’s SOC has embarrassed various public servants and the province “raising incendiary and inaccurate allegations of political intrigue and impropriety.. for personal gain” (para.16);
• Mentzelopoulos failed in her duty to manage AHS’s budget properly (para. 27);
• Mentzelopoulos’s obsession over surgical contracts led to delays thereby  “ignoring the hundreds of surgeries which had been booked and which would be jeopardized if the agreement was not extended” (paras. 31);
• the external investigation found no examples of impropriety (paras. 40- 45);
•  Plaintiff’s suggestion that she she was muzzled from speaking with the Auditor General is false (para. 47);
• Mentzelopoulos “mischaracterized” her discussions with provincial officials.  Given the GOA’s commitments to system reform it would not be “unusual” for the Premier’s Chief of Staff to inquire about the issue of surgical capacity (paras. 52-57);
• Marshall Smith (no relation to Premier Smith) had “no personal relationship with Mr. Prasad and, in fact, Mr. Smith has not met Mr. Prasad outside of the context of a few meetings with numerous other public servants in attendance” (para 54); .
• “Plaintiff’s suggestion that the timing of her termination was motivated by her planned meeting with the Auditor General is nonsensical” (para. 48);
• “Termination of the Plaintiff was discussed, and the termination process was supported by Ms. Fong as chair of the AHS Board” (para. 49); and
• Mentzelopoulos was “was dismissive of any review by the Auditor General when she discussed the matter with the Minister’s office” (para. 47).

  

The Province’s efforts to conduct any due diligence were stone-walled by the Plaintiff herself. On January 6, 2025, months and months after she had commenced her “investigation” the Plaintiff provided a letter advising the Province that her investigation had “not drawn any firm conclusions” and, despite being asked to produce any and all investigation records to permit the Province to carry out further due diligence, the Plaintiff was able to provide nothing more than six corporate searches (all of which were freely available to the public by way of a registry search and would have been available throughout the AHS procurement process which had been ongoing for years) and a single email unrelated to any outstanding procurement activities (para. 45(e)).

Alberta Health Services (AHS) Statement of Defence (filed 14 March)

AHS’s statement of defence is found below.

2503-02991-Filed-2025-03-14-Statement-of-Defence AHS

AHS is represented by Neuman Thompson  (Craig W. Neuman, K.C. / Chantel T. Kassongo, K.C.)  a labour law firm primarily representing employers. The Neuman Thompson brief focuses more heavily on employment contractual details. The gist of the filing is that Mentzelopoulos was fired for not performing her duties.

The main arguments advanced by the employer are:

• that the plaintiff has filed the claim for the “sole purpose of seeking further payment” (para. 2);
• there was a consistent pattern of ineffectiveness, mismanagement, and failure to execute key leadership responsibilities, including a laundry list of various “failures”” (paras. 9-11);
• a list of 7 specific rebuttals of facts alleged in Mentzelopoulous’s SOC, specifically a)  Mentzelopoulos was never “pressured” by Deputy Health Minister Tremblay to take the AHS job; b) the Minister of Health did not “demand” the Board fire the CEO; and c) communications between the plaintiff and the Health Minister were not known to AHS and the termination was “completely unconnected,” from those communications (para 13).

The Plaintiff’s employment with AHS ended because it lost confidence in her ability to discharge the function of her position in a competent and acceptable manner.  The Plaintiff’s allegations that her employment was terminated because of the investigation and audit she initiated into various AHS surgical facilities contracts is a diversion from the Plaintiff’s own inadequacies and the Plaintiff is solely responsible for the termination of her employment.

Mentzelopoulos Reply to Statements of Defence (filed 20 March)

Mentzelpoulos’s response  may be found below.

Athana_M_SoD_Response

Mentzelopoulos is represented by Dan Scott K.C. of Seveny Scott.

The Reply begins with a vigorous criticism of public remarks by LaGrange and Premier Smith which are

completely unfounded, entirely fictitious, malicious and bad faith allegations about Mentzelopoulos and her performance while CEO and President of AHS…. and are compounded by recent false public statements about Mentzelopoulos made by Premier Danielle Smith, and are consistent with recent comments made by Premier Smith’s former Chief of Staff, Marshall Smith, who has told people that he intends to ensure that Mentzelopoulos “never works again in Canada” (para. 3, 4).

The Reply includes more detail of the specific conversations between Metzelopoulos and departmental officials than the statements of defence.

• Minister LaGrange specifically acknowledged Mentzelopoulos’s “dedicated work and leadership of AHS” (paras. 3, 8, 9);
• The AHS board never lost confidence in the CEO (para. 7);
• At a 13 December 2024 meeting with LaGrange and Board Chair Angela Fong, Fong asked LaGrange if she had concerns about entering “contracts which will be competitive and all of the things we describe with individuals that were involved in these potentially very concerning activities?” and LaGrange replied she was not concerned despite the investigations not being completed (para 11a);
• LaGrange edited a letter to the principals of the Red Deer and Lethbridge chartered surgical facilities and “specifically removed any questions around the potential involvement of Prasad and another former AHS procurement employee” in the CSFs (para 11b);
• On 16 December 2024 Alberta Health advised AHS that the Premier had made some “commitments to the Tsuut’ina Nation to build a surgical facility.  Mentzelopoulos expressed surprise  “as political interference around AHS funded procurement had become common place” (para 11c);
• In a 19 December 2024 briefing to the AHS board it was revealed that Prasad had had an MHCare email during at least part of the time he was employed by AHS and “appeared to have been negotiating the purchase of children’s acetaminophen from MHCare” (para. 11d);
• At the same meeting (19 December 2024) Mentzelopoulos stated one of the goals of the investigation was to determine if a case could be made for the return of $49.7-million balance on the acetaminophen purchase through MHCare (para. 11f);
• At the same meeting one of the board members recommended that AHS should bring the matter to the attention of the RCMP- a meeting attended by all three GOA deputies on the AHS board (paras. 11g, h);
• On 2 January 2025 in conversation with Deputy Minister Evan Romanow (Mental Health and Addictions), Romanow said his minister Dan Williams ” freaked out about any potential connectivity or any exposure that there may be directly or indirectly to government through through AHS which “could lead to potential connections between various government officials and Sam Mraiche and MHCare Medical around AHS procurement issues” (para. 11k);.
• In the same conversation Romanow “discussed the development of recovery communities and the political involvement and direction around that part of the healthcare “refocusing” (para. 11k);
• On 6 January 2025, Mentzelopoulos advised Assistant Deputy Health Minister (ADM) Nickerson that she was scheduled to meet on 10 January 2025 with the Auditor General and two days later her employment was terminated “without cause” (paras. 11 l, m);
• the claim in the SODs that nothing was turned up in the investigation appears to be belied by statements by Premier Smith and LaGrange that the allegations were “serious” and need to be “thoroughly investigated” (para. 13) resulting in “at least six ongoing investigations” (para.12);
• reference to Mentzelopoulos’s use of “twat” may be in reference to the word being used by Deputy Health Minister Tremblay in a 2024 complaint (para. 14(a);.
• text from ADM Darren Hedley dated 30 October 2024 stated Prasad’s access to IT was being terminated and he was being put on administrative leave (para. 14);
• Mentzelopoulos competently managed the AHS budget which was faced with significant under funding (paras. 17-25); and
• contrary to the GOA-LaGrange defence, Mentzelopoulos was reassured that her AHS CEO role would be transitioned to Acute Care Alberta (para. 29).
  

  Analysis and Opinion

  In comparing the SODs with the SOC of Mentzelopoulos and the Reply, the former CEO is much more specific in her allegations. Abpolecon.ca has posted a chronology of dates with references found in the various briefs before the Court.

  

  Mentzelopoulos’s claims are indeed salacious and if proven would be most damaging to Premier Smith herself and her UCP government. Smith has already lost a former minister of infrastructure Peter Guthrie who released a damaging resignation letter.  Associated with the scandal is on changes made to the Conflicts of Interest Act  which changed the thresholds for disclosures around gifts and hospitality to members of the Legislative Assembly. Under those rules would become regulations and any future changes to those limits would not be reviewed by a MLA-led committee which produces a subsequent public report.  In addition, former Ethics Commissioner Marguerite Trussler’s contract was not extended and she was replaced by an individual who ran unsuccessfully for an Edmonton area UCP nomination, Sean McLeod. Trussler issued a damaging report on Smith’s attempts to influence her Attorney General 12 days before the 23 May 2023 election.

  The lawsuit may be settled out of Court with the public none the wiser.  The stakes are very high for Mentzelopoulos both financially and reputationally. For the government of Danielle Smith an out of court settlement with no details released will be viewed as the deep pockets of the government hiding the true state of affairs. That said there will be reports from Alberta’s Auditor General and the report from retired Manitoba Justice Raymond E. Wyant, the former chief judge of Manitoba’s Provincial Court. Before his appointment to the bench he was a criminal defence lawyer. In addition, the RCMP investigation will probably takle some time before there is any news on that front.  In the meantime, the opposition NDP are feasting on the scandal with Question Period an opportunity to question the credibility and honesty of government ministers.

Related Posts

Smith, LaGrange, Alberta public service face grave test

Chronology of Events- AHS CEO’s Statement of Claim