An embattled New York nursing home operator is facing a lawsuit that claims its “fraudulent” pattern of purchasing nursing homes with the intent to flip them into condominiums led to some residents’ premature deaths.
The suit, filed last week by CABS Nursing Home Company, Inc., details the sale of the Brooklyn facility to the Allure Group in 2015. The complaint claims that Allure was won its bid to buy the facility after representing that they would “turn the financial future of the nursing home around” and that “nothing would change.”
Less than two months after the sale was finalized, Allure and the facility’s newly hired administrator began moving patients out of the facility under a series of “ever-changing excuses,” including moving Medicaid residents to make room for higher-paying ones, and building a new therapy center for the facility, according to the complaint.
“In October 2015, the truth emerged through the press,” 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 facility’s suit argues that moving the residents “forced them 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 of the facility, as well as damages.
Allure has made headlines for similar nursing home “flips” in the past — including one instance investigated by New York Attorney General Eric Schneiderman — but CABS’ suit is believed to be the first brought against the company by a purchased property, according to the New York Law Journal.
“Indeed, it has become clear that it has become (or has always been) Allure’s primary purpose and goal to obtain nursing homes at reduced prices by promising that they will continue to operate them, only to turn around and sell the properties to developers at a massive profit as soon as the dust settles,” the complaint reads.
