Trans Healthcare and Trans Health Management, nursing home companies that controls a chain of nursing homes throughout the country seems to be continuously fighting off lawsuits, bad press, and claims of fraud. Bruce Rauner, the candidate for Illinois Governor, is snared in these issues, as his former company is accused of scheming to avoid liability for resident deaths. Nursing home negligence lawyers at Pintas & Mullins unpack this story to separate fact from hearsay.
As a federal trial begins in Florida, Rauner is making the media rounds in Chicago to promote himself as the Republican candidate for Illinois governor. When asked questions about Trans Healthcare, Rauner purposefully sweeps the issue under the rug, underplaying his role in the company and declining to respond further.
The scandal is quite complex, which makes it easier for Rauner to avoid the issue while campaigning. It also helps that the federal trial are in Florida bankruptcy court, involving shell companies, private equity firms, and nearly a decade of legal twists and turns. In other words, it isn't exactly the simplified, sensationalist media bait so loved by political candidates.
The saga begins, for our purposes, in 2003, at a Trans Healthcare-run nursing home in Florida. A resident there, 76-yaer-old Juanita Jackson, died five weeks after she was discharged from the nursing home due to injuries incurred during her stay. Her family claims the nursing home was negligent in its care for Jackson, leading to severe and numerous bedsores, falls causing head injuries, and malnutrition. A jury agreed with her family, deciding that Trans Healthcare should pay $110 million for her wrongful death.
Trans Healthcare and Trans Health Management were ordered to pay $55 million each, which the Jackson family has yet to see. Sadly, they are not alone: five other families with claims of wrongful deaths against the nursing home companies are stalled as well.
The bankruptcy court trial centers on claims that Bruce Rauner's private equity firm, GTCR, created a shell company to avoid paying over $1 billion for these wrongful death claims. In 2006, Trans Healthcare transferred its assets to a separate holding company (the shell company), while legal liability was transferred to an entirely different firm, which we will call Firm B.
In a heartbreaking testimony, which was videotaped and played for the court on Monday, an elderly graphic artist with absolutely no nursing home experience recounts how he, inexplicably, came to own Firm B. The man, Barry Saacks, testified that he had no idea that he was the lone shareholder of Firm B, and that he did not remember ever signing papers to buy Trans Healthcare.
It is fairly obvious that Saacks was used as a pawn, and his age brings suspect that it may have been a case of elder exploitation and financial abuse. In his testimony tapes, Saacks appears consistently confused by lawyers' questions and disoriented about the company that he supposedly owned. In many interviews, he is in a hospital gown and sits in a wheelchair. He says he's never heard of Trans Healthcare, only that he created logos and designs for an investor who was a partner with GTCR and Trans Healthcare.
Other lawyers state that Saacks was given cash to sign closing documents that made him the sole shareholder of Trans Healthcare. He is now himself living in a nursing home, and is listed as a plaintiff alongside the families with pending wrongful death suits. They are asking the federal judge to unravel the transfers and transactions and rule that the companies engaged in fraud.
Bruce Rauner ran GTCR for over twenty years and left only recently to pursue his campaign for Illinois governor, though he insists that he had little to no involvement in the actions of Trans Healthcare and its nursing homes. GTCR launched the Trans Healthcare nursing home chain in 1998, and Rauner was a member of its board. GTCR asks the judge to dismiss the claims.