Nursing Home Abuse Law: Case Focuses On Shell Companies

Today, most nursing homes are owned by large corporate conglomerates. This is true with Rhode Island nursing homes as well as across the country. These corporate structures present challenges for families who have experienced nursing home abuse and are looking for answers and to hold the nursing home owners responsible.

The Insurance Journal reports on a tragic case making its way towards trial. In 2010, a jury found in favor of the family of a 76 year old woman who alleged that she died after a pattern of nursing home neglect that included bedsores, malnutrition and a fall. The wrongful death jury verdict totaled $110 million.

But 4 years later, even though the defendants never appealed, the verdict remains unpaid. Now, nursing home abuse lawyers for the plaintiff have brought this second lawsuit, alleging that the defendants have engaged in fraud in an attempt to avoid payment.

According to the article, “[c]ollection was thwarted through a complex transaction that sent Trans Healthcare’s liabilities to a shell company called Fundamental Long Term Care Inc., which had no assets, while creating a solvent nursing home chain that was protected from judgments, lawyers for Jackson’s family contend.” The case is In re. Fundamental Long Term Care Inc., 11- bk-22258, U.S. Bankruptcy Court, Middle District of Florida (Tampa).

Oftentimes, the negligence that causes harm to a family member in a nursing home is systematic of a larger problem with the nursing home itself. For example, bedsores or falls can occur when the nursing home does not properly staff the facility. Inadequate staffing can be due to financial pressures from the corporate owners to stretch profits. As a Rhode Island nursing home lawyer, the idea that these corporate owners can set up “shell” companies to avoid payment on a jury verdict is troubling.