A controversial decision could be a "nightmare" for the government, a legal expert says.

A federal judge has dismissed a potential class action lawsuit against Skyline Highland Holdings — an entity connected to the operator whose homes went into receivership en masse this spring — ruling the case was without merit because attorneys failed to describe specific harm to residents.

An attorney argued that limiting the number of licensed nurses and staff on duty at four Highland nursing homes victimized residents because workers were unable to address basic needs. But a U.S. District Court judge found the suit’s broad allegations did not meet provisions of Arkansas’s Deceptive Practice Act.

“It does not discuss any particular damage or injury suffered by the three identified residents, who are represented by the named plaintiffs, on account of the alleged understaffing,” wrote Judge Brian S. Miller. “Instead, the complaint refers to the collective conduct of all of the defendants as causing collective injuries suffered by various, unidentified nursing home residents… Plaintiffs cannot simply rely on allegations of damages to unidentified residents.”

The suit dates to 2017, when JS Highland Holdings owned the four nursing homes being sued. Administrative and management company Skyline Holdings LLC was a subsidiary of JS, whose sole member was Joseph Schwartz. He was the effective owner of all the nursing homes, according to Lexis Legal News.

Before its collapse this spring, Schwartz’s Skyline still operated 21 facilities in Arkansas under five different corporate entities. The state placed two of those buildings into receivership in April.

In Nebraska, Kansas, Pennsylvania and South Dakota, employees complained that Skyline failed to pay staff, skipped out on healthcare premiums and came close to running out of food or medication for residents.

In the 2017 case, Miller also dismissed claims from estate administrator James Green that Skyline and its nursing homes breached various admissions agreements, committed illegal exaction, engaged in civil conspiracy and were unjustly enriched.