OCEANSIDE ---- A dispute over a failed partnership between Tri-City Medical Center and a Wisconsin-based health care consulting company that was to build an outpatient surgery center on hospital-owned property has resulted in dueling lawsuits.

Court records show that Tri-City sued developer Hammes Healthcare on Sept. 1, alleging that the company failed to meet the requirements of a contract between the two parties because it did not secure enough investment from local physicians.

Hammes fired back on Oct. 19, claiming that Tri-City owes it more than $1 million in damages for costs it incurred in preparing to build the center on what is now a section of parking lot at the hospital campus near the corner of Thunder Drive and Vista Way.

In 2005, the Tri-City board voted 5-2 to create the center, which was to go forward only if at least 20 local doctors agreed to buy shares in the venture. Tri-City invested an initial $1 million, giving it a 51 percent stake in the business. Hammes was to build and own the building and the partnership was to pay the company rent.

None of that came to pass. The hospital announced in the spring that it would give up on the idea due to lack of interest from doctors.

The suit and counter suit represent yet another legal entanglement for the public hospital district, which is already embroiled in several other court actions.

Since the hospital's board of directors sidelined the hospital's former leadership on Dec. 18, 2008, the hospital has sued Scripps Health, alleging inappropriate patient referral practices.

Meanwhile, seven hospital executives who were fired from Tri-City have sued the hospital, alleging wrongful termination. The fired supervisors have also sued the board, alleging that certain aspects of a Dec. 18 closed-door meeting ---- in which the supervisors were abruptly placed on paid leave ---- violated open meetings law.

It was unclear Friday exactly how much Tri-City has spent so far this year in legal fees.

In its lawsuit against Hammes, Tri-City states that the company was to find tenants for the surgery center no later than Dec. 31, 2007. The suit further states that an amended version of the contract between the two parties required Hammes to get building permits and other "government approval" to contruct the building by Jun. 30, 2009. Hammes reportedly sought $437,013 from Tri-City to recoup half of its development costs.

In its suit, Hammes accuses Tri-City leadership, including chief executive Larry Anderson, of stalling negotiations just long enough to take the company past the final date when it could have cancelled its contract with the hospital. It asks the court to order Tri-City to pay more than $1 million for loss of profits and for development costs that include "undertaking architectural, construction, government and environmental assessments and approvals plus loss of funds, costs and interest."

Attorneys representing both sides did not return calls for comment Friday.

Call staff writer Paul Sisson at 760-901-4087.