PPE Medpro, a medical supply company linked to peer Baroness Mone and her husband Doug Barrowman has been ordered to pay damages after a judge ruled it breached the contract.
The Department of Health and Social Care took legal action against PPE Medpro over claims the medical gowns it supplied did not comply with relevant healthcare standards.
The High Court ruled that Medpro failed to prove whether or not its surgical gowns, which were to be used by NHS workers, had undergone a validated sterilisation process. The court said the firm had until 15 October to pay the damages to the government.
The company, a consortium led by Lady Mone’s husband, businessman Doug Barrowman, was awarded the contracts by the former Conservative government to supply PPE during the pandemic, after she recommended it to ministers.
Court documents lodged in May state that the DHSC assert that the gowns were delivered to the UK in 72 shipments between August and October 2020, with £121,999,219.20 paid to PPE Medpro between July and August that year.
In December 2020, the gowns were rejected by DHSC and the company was told it would need to repay the money. The company did not comply with the demand, and the gowns remained in storage unable to be used.
Baroness Mone described the judgment as an “establishment win” for the government in a case that was “too big for them to lose”.
She said: “Today’s judgment against PPE Medpro is shocking, but all too predictable. It is nothing less than an establishment win for the government in a case that was too big for them to lose.”
In a written statement, Mr Barrowman, a businessman who led the consortium, said: “Today, a travesty of justice took place following the judgment of Lady Justice Cockerill.
“She gave the DHSC an establishment win despite the mountain of evidence in court against such a judgment.
“This judgment is a whitewash of the facts and shows that justice was being seen to be done, where the outcome was always certain for the DHSC and the government. This case was simply too big for the government to lose.”
The judge said that during the closing stage of contract negotiations, one of PPE Medpro’s directors, Anthony Page, contacted Baroness Mone, who then threatened “further escalation”.
She said: “Mr Page engaged his ‘big gun’ – contacting Baroness Mone who then took up the fight on behalf of Medpro direct with Chris Hall from the Cabinet Office threatening further escalation. Baroness Mone was plainly of the view that there was a contract.”
The judge also said PPE Medpro “claimed to be well established” to the DHSC, and the “years of experience” of Mr Barrowman were “trumpeted”.
She said: “Medpro was presenting itself to DHSC as a worthy entrant into the fast lane for approval as a supplier and aiming to land contracts worth hundreds of millions of pounds of public money. It said repeatedly that it had experience.”
The judge ruled the company much pay £121,999,219 in damages, plus interest, however, it remains unclear how Medpro will pay the fee, with the company appointing administrators the day before the court decision.
Its last set of accounts said it only had £666,025 of shareholders’ funds.
Health minister Stephen Kinnock said the government had the “full force of the law behind us” to ensure the £122m was paid back. “We want our money back, we are going to get our money back,” he said.
Top of page picture: Hospital consultants wearing PPE while carrying out a procedure on a patient during the Covid pandemic.