FirstMed EMC's sudden closure Dec. 6 cost 65 local employees their jobs, according to a notice filed this week with the N.C. Department of Commerce.
The Wilmington-based medical transportation company closed its doors after lenders cut off funding it needed to continue operating, FirstMed said in a so-called WARN notice.
The WARN notice – by Eastern Shore Acquisition Corp. (ESAC), also doing business as FirstMed – said the company ceased operations because of its "failure to obtain investment or continued funding."
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A FirstMed employee filed a class-action suit against the company Dec. 10 charging that FirstMed violated the WARN act in not giving advance written notice to employees of their terminations. The lawsuit seeks 60 days worth of wages and other compensation for those who lost their jobs.
FirstMed gave the notice in a letter to its employees in Wilmington dated Dec. 6, but the WARN notice was not received by Commerce until Monday. The notice said the company had notified Mayor Bill Saffo and the Commerce Department of the closing.
FirstMed's WARN notice filing "doesn't have any effect on the employees' rights," said Jack A. Raisner of Outten & Golden in New York, the plaintiff's attorney in the class-action case.
The WARN notice said the company "currently has ceased operating as a going concern and is solely engaged in attempting to liquidate its assets," the notice said.
Six companies associated with FirstMed filed for Chapter 7 bankruptcy liquidation last week. Among them was Eastern Ambulette & Ambulance Service Inc., which filed WARN notices last week for locations in several Ohio cities affecting hundreds of workers. About 2,000 FirstMed employees lost their jobs across the company's multi-state footprint.
The Chapter 7 petitions listed 1,000 to 5,000 creditors owed $10 million to $50 million. The companies' assets were listed as $1 million to $10 million.
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