A $5.75 million verdict against the former administrator and board members of a historic nursing home should be thrown out because their misconduct was not malicious, a lawyer argued before a federal appeals court this week.
The former administrator and more than a dozen former directors of the Lemington Home for the Aged have been involved in litigation for nearly a decade. After the bankrupt nursing home closed in 2005, unsecured creditors charged that the facility leaders had breached their fiduciary duty by grossly mismanaging the home. In addition to its financial woes, poor care was implicated in the deaths of two residents.
A jury awarded the creditors with $2.25 million in compensatory damages and $3.5 million in punitive damages in 2012. In May of last year, a judge denied the defendants’ request for a new trial.
Appearing before the 3rd U.S. Circuit Court of Appeals in Pittsburgh, defense lawyer Michael Browne acknowledged a “hodgepodge of misconduct,” according to the Pittsburgh Tribune-Review. However, this misconduct was due to the home’s financial difficulties rather than any malicious intent on the part of its leaders, and therefore the damages against them are not appropriate, Browne argued.
The opposing counsel countered that the defendants were “recklessly indifferent” in the way they ran the facility, the Tribune-Review reported.
Lemington was founded in 1883 and was the nation’s oldest African-American sponsored nursing home at the time of its closure.
