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New player enters hospital lawsuit

Staff writer

A motion was filed Thursday seeking to intervene in a Bank of Hays mortgage foreclosure lawsuit against the company that owns Hillsboro Community Hospital.

Wichita lawyer Thomas Gilman, who represents hospital owner CAH Acquisitions Co. #5, filed the motion to intervene on behalf of Health Acquisition Co., LLC.

HAC is linked to CAH in numerous lawsuits filed in other courts, including one that arose from a $90 million billing scheme blasted by a Missouri state audit, but Gilman’s office said HAC and CAH are different companies.

The motion to intervene contains a statement by Paul Nusbaum. Nusbaum wrote that he was a board member of HMC/CAH Consolidated from 2007 to 2013. HMC/CAH Consolidated filed for bankruptcy in 2011 and emerged in 2013. According to Becker’s Hospital Review website, Rural Community Hospitals of America is an offshoot of HMC/CAH.

The West Virginia Secretary of State website lists Nusbaum as an officer of RCHA, and in that capacity he is a defendant in a fraud and breach of contract lawsuit filed 10 months ago in a Missouri federal court by American Health Care Capital.

According to the motion filed Thursday, Bank of Hays and the City of Hillsboro each previously agreed that Gemino Healthcare Finance would have a first priority lien on accounts receivable of CAH Acquisitions Co. #5.

HAC is the successor to Gemino, Gilman’s motion states.

Gilman, who earlier filed on behalf of CAH a notice of appeal of the district court’s decision to put HCH into receivership, also filed CAH’s answer to the lawsuit Thursday. The answer generally denies allegations by the Bank, and disputes information used by the bank and Hillsboro to get a receiver appointed. It also makes a counterclaim seeking more than $75,000, claiming that getting a receiver appointed was an “abuse of process,” and “CAH 5 has been damaged as a direct result of the wrongful appointment of a receiver.”

“The bank intentionally misled this court to achieve the appointment of a receiver and gain improper access to the receivables to the detriment of CAH 5,” the counterclaim states.

Last modified Feb. 28, 2019

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