Evans Senior Investments (ESI) represented the bankruptcy disposition of two skilled nursing facilities in Florida. The bankruptcy stemmed from a medical whistleblower whose case resulted in a civil fraud judgment of $256 million. Both nursing communities operated under the brand of Consulate Health Care and filed for bankruptcy when the skilled nursing operating entities could not afford to pay the False Claims Act judgment against them. At the time of writing, Consulate is the sixth-largest nursing home chain in the country with 138 facilities from the Mid-Atlantic to the Gulf Coast.
ESI was hired to represent the debtors in the sale of their assets, in obtaining debtor-in-possession financing and in providing a confidential valuation. After an auction, the assets were sold in a credit bid transaction.
In 2017, a federal civil jury concluded that nursing homes now owned by Consulate defrauded taxpayers through inflated billings for rehabilitation services for residents. The penalty was the culmination of a whistleblower case brought in 2011 against an earlier owner of Consulate’s nursing homes by Angela Ruckh, a nurse who worked at two of the chain’s nursing homes. However, the Justice Department and Ms. Ruckh agreed to settle for $4.5 million: the United States will receive $3.375 million and Ruckh $1.125 million.
