The Tallahassee Branch NAACP plans to ask a judge to reconsider his dismissal of a lawsuit that attempted to undo the transfer of Tallahassee Memorial HealthCare’s assets.
On Aug. 31, Circuit Judge Lee Marsh ruled that the local NAACP and four residents lacked standing to challenge the TMH transfer to Florida State University and that the state law they relied upon does not apply to the deal.
Marsh dismissed the case “with prejudice,” meaning a permanent end to the suit and barring the NAACP from ever again filing the same claim against the city.
But attorney Jack McLean Jr. said in a new motion he intends to file that Marsh’s decision was “premature” and “overlooked key legal and factual issues,” adding that Marsh “improperly relied on documents outside the scope of the complaint.” The motion was provided to the Tallahassee Democrat Sept. 16.
Scenes from Tallahassee Memorial HealthCare throughout the years
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Tallahassee Memorial HealthCare, Tuesday, April 7, 2020. (Alicia Devine/Tallahassee Democrat)
The judge also didn’t provide clarity on “unresolved questions about the NAACP branch’s legal capacity to sue and the city’s ongoing retention of $109 million in hospital sale proceeds that, by law, should be allocated to indigent and underinsured patient care,” the organization said in a news release.
The NAACP has long argued that the transfer is illegal and could harm the community’s healthcare safety net and indigent care.
Legal interpretation of state law at heart of case
At the heart of the case lies a debate on whether a state law, Section 155.40 of the Florida Statutes, which governs certain public hospital sales and leases, applied to the city’s transfer of TMH assets to FSU. The plaintiffs say the law applies and that the city failed to comply; the city continues to stand firm that it doesn’t.
Marsh also found the state law doesn’t apply, finding it governs sales or leases to private nonprofit or for-profit entities, not transactions involving a state agency. In his dismissal, he noted FSU is a governmental entity and “an agency of the state,” placing the transfer outside the scope of the law cited by the plaintiffs.
“The plaintiffs are seeking to have the dismissal order vacated, the case reinstated, and permission to file an amended complaint,” the NAACP’s news release says. “They emphasize the importance of ensuring that public funds from the hospital sale are used as intended by law to benefit the community’s most vulnerable residents.”
Former mayor Jack McLean speaks during public comment just moments before the City of Tallahassee votes on the sale of the TMH to FSU Wednesday, March 11, 2026.
The FSU Health enterprise and academic medical center, which according to the city and FSU hinged on the transfer of the hospital, is designed to “bring researchers, educators, and clinical partners under one umbrella to transform health and healthcare in Florida.”
Under terms of the sale, the university will pay the city $109 million for their hospital land and assets over a 30-year period, while FSU will invest $100 million in existing hospital facilities and another $150 million on the newly branded FSU Health. The university also has “aspirational plans” to invest $1.7 billion in healthcare improvements, contingent upon legislative appropriations and state and federal grants.
The new academic medical center, patterned off the UF Health enterprise, offers bold promises to patients seeking better healthcare and could create a new economic engine in Florida’s capital city.
But it came together under a cloud of controversy and a 3-2 City Commission vote in March after hospital officials initially accused city leaders and FSU of holding secret meetings to engineer a hostile takeover of the hospital.
(This story was updated to add new information.)
This article contains previously reported material. Elena Barrera can be reached at ebarrera@tallahassee.com. Follow her on X: @elenabarreraaa.
This article originally appeared on Tallahassee Democrat: NAACP seeks to revive lawsuit over TMH transfer to FSU