UPDATE: Former chief operating officer of Yale New Haven Hospital, Michael D. Holmes, has filed a lawsuit demanding $994,000 from the hospital, claiming breach of contract regarding post-termination payments. Holmes alleges the hospital failed to issue an initial payment of $248,000 that was due on September 3, 2025, and has refused to provide any future payments.
The legal action, filed on November 5, 2025, comes at a time when tensions are high within the organization. According to the complaint, the hospital argues that Holmes is ineligible for payments due to a claim that he “failed to provide sufficient notice of his intent to resign.”
In a statement, Carmen Chau, spokesperson for Yale New Haven Health System, confirmed awareness of the lawsuit and stated, “Yale New Haven Health denies the allegations and intends to vigorously defend against them.”
Holmes’ complaint details that he was entitled to a series of payments, referred to as covenant payments, contingent upon adhering to a non-compete agreement. The agreement, which Holmes signed in 2013, stipulates three payments over 18 months following termination, aimed at preventing competition. Notably, the hospital has not accused Holmes of violating this agreement.
The former COO claims that his decision to leave was driven by what he describes as the hospital’s “increasing mismanagement of its healthcare system,” compounded by the departure of several senior leaders. Seeking new employment, Holmes accepted a position as senior vice president and Gainesville regional president at University of Florida Health System on January 31, 2025.
In a letter dated January 31, the hospital’s Chief Human Resources Officer, Melissa Turner, cited Holmes’ failure to provide three months’ notice as grounds for denying payment eligibility. However, Holmes disputes this claim, stating that the non-compete agreement does not require advance notice of resignation.
Holmes further asserts he remains compliant with the non-compete, as his new role in Gainesville, Florida, is over 1,000 miles away from New Haven, which is well beyond the 120-mile restriction set by the agreement.
Holmes is seeking $994,000 in compensatory damages for what he describes as actual and anticipated breaches of the contract, alongside legal fees and any additional relief deemed appropriate by the court.
As the case unfolds, it highlights significant issues within the leadership and operational management at one of the nation’s largest hospitals, ranked second by bed count in 2021 by Becker’s Hospital Review.
What happens next in this legal battle could have wide-ranging implications not only for Holmes and Yale New Haven Hospital but also for healthcare leadership accountability across the nation. Stay tuned for further developments as this story progresses.
