Shareholders of Genesis HealthCare Corp. are scheduled to vote this week on whether to approve the $1.7 billion sale of the company amid allegations that an unfair bidding process greased the transaction.

Last week, Northbrook GH LLC, which owns a 5% stake in Genesis, said a $50 million breakup fee written into the deal wrongly discourages other potential bidders. That comes on top of, Drumm Investors LLC, an affiliate of Fillmore Capital Partners, which purchased Beverly Enterprises Inc. last year, filing a lawsuit in late March alleging that the company breached commitments made to Drumm in connection with the bidding process.

Genesis defended itself against the allegations:
“The fact is that the final price was driven by an active, competitive auction, which yielded four highly interested bidders all of whom submitted best and final offers,” it said in a statement.

Genesis shareholders are expected to vote Thursday on the $63-per-share sale of Genesis to a joint venture of Formation Capital LLC and JER Partners.