Healthcare

Healthcare is a highly-regulated and complex industry in which we have specific and extensive experience. In one example, we filed a highly-structured Chapter 7 bankruptcy case for a California medical clinic in which we strategically arranged for the purchase of "tail" medical malpractice insurance coverage for the doctors in a way that protected them against fraudulent transfer and preference claims. Thereafter, we took advantage of a new law, namely Bankruptcy Code Section 351, which provides for the orderly distribution and disposition of patient records. Although the Chapter 7 trustee resisted the new law, we were able to compel the trustee to properly distribute the patient records.

Among our former clients is a residential care facility for the elderly (RCFE) that was on the brink of foreclosure. We successfully reorganized the RCFE, first by preventing the foreclosure in a Chapter 11 bankruptcy. The facilities continued to operate without interruption with no loss of jobs and no disruption to patients. It is important to note that RCFE patients experience a high mortality rate when forced to move. Second, we successfully sued several third parties, including taxing authorities, to clear title to the underlying real property. Finally, we obtained court approval of approximately $1.3 million in new financing and brought the RCFE out of bankruptcy.

For another RCFE operated as a non-profit, in the midst of complex litigation, we started by connecting the RCFE with a highly competent interim director to manage operations. Thereafter, we assisted the RCFE in selling its facilities while still operating and preparing to transform the non-profit into a grant-making foundation for the elderly. All the while, we made sure to provide adequate notice of possible termination and options for patients and their families. This project involved the intersection of three highly-technical areas: specifically, RCFE's, non-profits (including working with the Attorney General) and insolvency. This case is emblematic of the sorts of problems and solutions to which we are well suited.

Partner Iain A. Macdonald has been appointed Chapter 11 bankruptcy trustee (an independent fiduciary) to operate an optometry clinic. Mr. Macdonald successfully reorganized the business under a plan providing for payment of all creditors in full. We have also served as counsel in successfully reorganizing dentistry practices and other health-related businesses.

The foregoing examples cover only a portion of our healthcare experience. We invite you to discuss options for your practice in a confidential consultation by contacting us online.