Provider claims purchaser's flip scheme expedited deaths
Allure made false promises to SNFs, Schneiderman’s office says
A New York nursing home provider claims a fellow operator's plans to purchase nursing homes and flip them into condominiums led to some residents' premature deaths, according to a lawsuit filed in late December.
The complaint, launched by CABS Nursing Home Company Inc., claims the company sold its Brooklyn skilled nursing facility to the Allure Group in 2015 under the belief that Allure would “turn the financial future of the nursing home around” and that “nothing would change.”
An attorney for Allure responded to the suit saying the company did not agree “to operate a nursing home for any period of time,” the New York Post reported.
CABS goes on to claim that Allure and the facility's new administrator started moving residents out of the facility less than two months after the sale was finalized, under the guise of “ever-changing excuses” such as they were building a new therapy center.
“In October 2015, the truth emerged,” the lawsuit reads. “Contractors working for Allure had filed a permit to demolish the nursing home ... and filed a permit to build a new luxury condo building a few weeks later.”
The lawsuit alleges that Allure's plans to flip the facility into condos “forced residents from the only home that many of them had known for years … with the effect that some of them died prematurely.”
CABS is seeking rescission and nullification of the sale, as well as damages.
The CABS case isn't the first time Allure has found itself in hot water over a nursing home flip. New York Attorney General Eric Schneiderman announced last year his plans to investigate Allure's $72 million sale of one facility for housing developments.
Another New York facility purchased by Allure sued Schneiderman last summer, after he blocked its sale to the embattled operator.