Plenty of entrepreneurs in Missouri and Illinois have noticed the growing demand for elder-care services as the number of Americans needing such resources continues to skyrocket. This has resulted in a boom in corporate nursing home owners who often demonstrate they care more about their profits than actual resident well-being. Many such negligent nursing facilities also engage in creative tactics to protect themselves for facing liability in the event that abuse or neglect results in injury, but there are ways to cut through these attempts to shield corporate nursing home owners.
Many corporate nursing home owners utilize a strategy of various single purpose enterprises (SPEs) to make their facilities appear less attractive for purposes of personal injury lawsuits. This means that the facilities will often form a multitude of shell companies to hold certain assets, and funnel money to accounts which a parent company can access.
Fortunately for deserving victims of nursing facility neglect or abuse, there are tactics which can be employed to cut through attempts to shield corporate nursing home owners from responsibility.
There are several liability theories that may be employed to hold these parent companies accountable for negligence or abuse.
• Direct liability of corporate parents. In certain instances, courts will rule that a parent company is liable for negligence if it is demonstrated that the parent company was immediately involved in overseeing a subsidiary’s business affairs, such as control, management and operation This especially holds true if the parent company specifically ordered an activity which could lead to foreseeable injury.
• Direct liability of corporate officer/shareholder for tortious actions. Plaintiffs may be able to name controlling corporate officers as separate defendants if it can be established that the corporate officers either committed, inspired, or participated in the tortious actions.
• Vicarious liability of corporate parents. To prove this, it must be established that employees engaged in willful conduct and the employer bore some responsibility for foreseeably contributing to the situation that resulted in the plaintiff’s injury.
• Joint venture. If the parent company exercised at least some control over the nursing facility’s specific activities, and also shared in the facility’s profits, then it can be held liable in some cases.
• Agency. In order to prove that a parent company enjoyed an agency relationship with a nursing home, it must be shown that the parent exercised control over a licensee’s activities, and that the licensee was acting as an agent of that parent company.
As these strategies show, all hope is not lost if a Missouri or Illinois plaintiff needs to cut through attempts to shield corporate nursing home owners from liability. Victims who have suffered from nursing facility neglect or abuse can seek to hold corporate parents responsible if one of several different conditions can be proven. This can help injured residents and their family members obtain the financial restitution they deserve.
Disclaimer: The choice of a lawyer is an important decision and should not be based solely upon advertisements.
Source: “Representing the Elderly: Find the hidden evidence of nursing home ownership” by Kenneth L. Connor and C. Caleb Connor. October 2012, Volume 48, No. 10.