A federal appeals court won’t reopen a nearly $1 billion lawsuit against a Florida nursing home operator accused of racketeering-like behavior in a lengthy civil case.
A group of residents had accused marketing company Marcus & Millichap and owner Michael Bokor of omitting key details from their nursing home licensing applications. They argued that made the licenses for 22 facilities invalid, claiming the operator’s services should have been “unbillable.”
An attorney for three residents or their estates earlier last year asked the US Court of Appeals for the Eleventh Circuit to allow the case to proceed, with a potential for some $900 million in damages if granted class standing.
But in a June 28 ruling, a three-judge panel declined to review the District Court’s decision to dismiss the residents’ complaint, noting they did not earlier object to issues the court raised about federal and state conflicts. The panel also denied a motion to amend the complaint again.
The case has had a complicated and winding journey, with several fights over jurisdiction and standing that initially resulted in a 2021 District Court dismissal. In her original 2018 filing, former short-stay resident Betty Smith claimed that she and two other plaintiffs had suffered financial harm because the three nursing homes they had stayed in had all been licensed under false pretenses.
They accused Bokor, owner of the nursing homes’ management companies, of supplying incorrect information on the licensing applications of the three skilled nursing facilities where they stayed, as well as 19 others in Florida. They alleged Bokor and earlier co-defendants schemed to sell the properties before the state’s licensing agency realized any issues.
In court last October, plaintiffs’ attorney Mary Perry told the Circuit Court judges that Bokor and Marcus & Millichap had intentionally made “misrepresentations as to management companies and individuals involved in the nursing home chain that had significant problems in the past.” She argued that the lower court dismissed the case improperly before allowing the plaintiffs to get to the discovery phase; an amended complaint that sought to add a conspiracy allegation was also rejected.
That amended complaint alleged Bokor committed wire and mail fraud through the companies’ submission of claims to the Centers for Medicare & Medicaid Services. It also alleged he failed to uphold his fiduciary responsibility to patients.
In court, defense attorney Diana Evans had said neither claim was “plausible.”
Attorneys for Marcus & Millichap did not provide comment on the ruling this week.
It was on a single cause for dismissal — that the federal court could abstain from hearing the case because there was similar litigation pending in state court — that the Circuit judges based their June 28 order to stay, or stop, the plaintiffs’ case.
“We do not find it necessary or appropriate to reach the legal issues the Residents raise because they waived arguments against the other reasons … that the District Court adopted,” they wrote.
The plaintiffs, the panel found, had failed to refute the court’s finding that the plaintiffs had already filed other lawsuits in state courts in Florida. That meant they then waived their right to refute those arguments at a later time, the Circuit Court judges ruled.
The case could be resurrected if the state court cases are resolved, but courts already have agreed to dismiss the case for four other reasons ranging from lack of standing to administrative law overlap.
