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Pa. Supreme Court revives AG's lawsuit against the Golden Living nursing home chain
Patriot-News - 9/26/2018
Sept. 26--In a ruling that could have widespread reverberations, the state Supreme Court has reinstated the attorney general's lawsuit against a nursing home chain accused of misrepresenting its level of resident care.
The decision comes 18 months after a Commonwealth Court panel dismissed that suit against Golden Gate National Senior Care and its statewide affiliates, including several nursing homes in the midstate that operate under the Golden Living Centers name.
Justice Christine Donohue found in the Supreme Court opinion that Commonwealth Court was wrong to deem that the Golden Gate care claims the AG attacked as false constituted mere "puffery" that isn't legally actionable.
Unlike the Commonwealth Court, Donohue also concluded the AG's claims against the chain under the state's Unfair Trade Practices and Consumer Protection Law were not too vague to support the suit.
The AG's battle with Golden Gate is in its third year. The case was launched in 2015 under the administration of former AG Kathleen Kane and is now being pursued by AG Josh Shapiro.
In filings in the case, Shapiro warned the Supreme Court that a decision upholding the Commonwealth Court dismissal could gut the state's ability to enforce its consumer protection laws.
The crux of the dispute is the AG's claims that Golden Gate exaggerated the level of care provided to its customer and deliberately understaffed its facilities to maximize profits.
During the course of the legal fight, Golden Gate sold several of its midstate centers that were named in the AG's complaint. Those sold included Golden Living West Shore, Golden Living Camp Hill, Golden Living Blue Ridge Mountain in Dauphin County and Golden Living Gettysburg. Also included in the suit are the Golden Living centers in Lancaster and Reading.
Donohue found the Commonwealth Court's dismissal of the case faulty on several accounts. For starters, she concluded, the AG's false advertising allegations are based on more than boastful "puffery"- exaggerations that aren't legally actionable.
Rather, Donohue wrote, the AG is claiming Golden Gate wasn't delivering on specific promises it made to attract its elderly and/or disabled customers.
She cited the AG's contention that despite Golden Gate's stated promises to provide prompt food and sanitary services, residents of its facilities "routinely have to wait hours for food, assistance with toileting, changing of soiled bed linens and other elements of basic care and sometimes must forgo them entirely."
Those claims, if true, contradict Golden Gate's advertising that paints an idyllic picture of the services provided at its facilities, Donohue noted.
"We hesitate to conclude that consumers seeking a nursing home would necessarily find statements promising to provide food, water and clean linens to be hyperbolic in any respect, or to be a vague statement of optimism or intent," she wrote. "There is no reason to think that a consumer would not take these statements seriously."
Nor did Donohue agree with the Commonwealth Court's finding that the AG's suit lacked specifics. The suit was based on information investigators claimed to have gotten from Golden Gate's customers and staff, she noted. The allegations made in the complaint are sufficient to put Golden Gate on notice as to why it is being sued.
The only aspect of the Commonwealth Court ruling the Supreme Court upheld was the finding that the state's accusation of unjust enrichment was premature. That issue can be addressed if the AG wins the case, Donohue found.
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