Tender Touch Rehab Servs., LLC v. Brighten At Bryn Mawr

• Decision Date: 13 June 2014
• Docket Number: Civil Action No. 11–7016.
• Citation: 26 F.Supp.3d 376
• Court: U.S. District Court — Eastern District of Pennsylvania
• Parties: TENDER TOUCH REHAB SERVICES, LLC, Plaintiff, v. BRIGHTEN AT BRYN MAWR, Brighten at Ambler, Brighten Health Group, LLC, Bryn Mawr Health Care Group, LLC, Ambler Healthcare Group, LLC, Chatau Senior Services, LLC, Saber Healthcare Group, Saber Healthcare Holdings, LLC, Aviv Healthcare Properties, LP, John Does 1–10, and ABC Corporations 1–10, Defendants.

26 F.Supp.3d 376

TENDER TOUCH REHAB SERVICES, LLC, Plaintiff

v.BRIGHTEN AT BRYN MAWR, Brighten at Ambler, Brighten Health Group, LLC, Bryn Mawr Health Care Group, LLC, Ambler Healthcare Group, LLC, Chatau Senior Services, LLC, Saber Healthcare Group, Saber Healthcare Holdings, LLC, Aviv Healthcare Properties, LP, John Does 1–10, and ABC Corporations 1–10, Defendants.

Civil Action No. 11–7016.

United States District Court, E.D. Pennsylvania.

Signed June 13, 2014.

Filed June 16, 2014.

Bruce S. Luckman, Sherman Silverstein, Moorestown, NJ, Steven D. Gorelick, Garfunkel Wild PC, Hackensack, NJ, for Plaintiff.

Eric E. Reed, Fox Rothschild LLP, Philadelphia, PA, for Defendants.

MEMORANDUM OPINION

TUCKER, Chief Judge.

Presently before this Court is Defendants Saber Healthcare Group, Saber Healthcare Holdings, LLC, Bryn Mawr Healthcare Group, LLC(collectively, “Saber”), and BHG Aviv LLC's (“Aviv”)¹Motion for Summary Judgment in their favor on all claims asserted by PlaintiffTender Touch Rehab Services, LLC(“Plaintiff”).In its Complaint, Plaintiff claims that Defendants Brighten at Bryn Mawr, Brighten at Ambler, and other related entities are liable to it for payment of performed services under theories of breach of contract, account stated, promissory estoppel, unjust enrichment, and breach of the implied covenant of good faith and fair dealing.Plaintiff alleges that Saber is responsible for Brighten's breaches under successor liability theories, and that Saber and Aviv are liable for civil conspiracy.Upon consideration of the parties' motions with briefs and exhibits, this Court will deny Defendants' motion in all respects for the reasons set forth below.

I.BACKGROUND

Plaintiff submits that this “action arises out of Defendants' breach of the parties' agreements and failure to pay Tender Touch for therapy services provided to the nursing home residents of Brighten–Bryn Mawr and Brighten–Ambler.”(Compl. 1.)The relevant facts are as follows.

Brighten at Bryn Mawr is the registered fictitious name of Chateau Senior Services, LLC, which formerly operated a nursing home at 956 Railroad Avenue, Bryn Mawr, Pennsylvania.Brighten at Ambler is the registered fictitious name of Ambler Senior Services, LLC, which formerly operated a nursing home at 32 South Bethlehem Pike, Ambler, Pennsylvania.Brighten at Bryn Mawr, Brighten at Ambler, and related entities (collectively, “Brighten”) were all part of the Brighten Health Group.(LandenbergerDep. 39:4–10.)

A.Master Lease between Brighten and Aviv

On February 9, 2007, Brighten, as Lessee, and Aviv as Lessor, entered into a Master Lease.(Defs.' Ex. F, Master Lease.)Under the lease's terms, Brighten leased from Aviv the land, facilities, and personal property used to operate, inter alia,“a 160–bed nursing facility on land commonly known as Brighten at Bryn Mawr, 956 Railroad Avenue, Bryn Mawr, Pennsylvania, 19010,” and “a 100–bed nursing facility on land commonly known as Brighten at Ambler, located at 32 South Bethlehem Pike, Ambler, Pennsylvania 19002”).²(Id. at D02364)(emphasis added).As stated in the lease, Aviv was the contract purchaser of Brighten at Bryn Mawr and Brighten at Ambler, and owned all “personal property” at the facilities, including furnishings, furniture, equipment, and fixtures.(Id. at D02364–65.)The lease also gave Aviv a first lien paramount to all others, subject to any Mortgage/Underlying Lease made by Lessor, on every right and interest of Lessee in and to the lease, and on “any furnishings, equipment, fixtures, accounts receivable, certificates of need, licenses, provider agreements, certifications or other property of any kind belonging to Lessee and used in connection with the Lease or located at the Demised Premises.”³(Id. at D02377.)The Master Lease provided as follows in the event of Brighten's default under the lease:

ARTICLE 21—LESSOR'S REMEDIES UPON DEFAULT

21.1.In the event of any Event of Default on the part of Lessee, Lessor may, if it so elects, with or without any demand whatsoever upon Lessee, forthwith either to (i) terminate this Lease and Lessee's right to possession of the Demised Premises; or (ii) terminate Lessee's right to possession of the Demised Premises without terminating this Lease.Upon any such termination of this Lease, or upon any such termination of Lessee's right to possession without termination of this lease, Lessee shall vacate each of the Facilities comprising the Demised Premises immediately, and shall quietly and peaceably deliver possession thereof to Lessor, and Lessee hereby grants to Lessor full and free license to enter into and upon the Demised Premises in such event with or without process of law and to repossess the Demised Premises and the related Personal Property as Lessor's former estate.In the event of any such termination of this Lease, Lessor shall again have possession and enjoyment of the Demised Premises subject to such termination and the related Personal Property to the extent and as if the Lease had not been made, and thereupon the lease of the Demised Premises and everything herein contained on the part of Lessee to be done and performed in connection therewith shall cease and terminate, all, however, without prejudice to and without relinquishing the rights of Lessor to rent ... or any other right given to Lessor hereunder or by operation of law.

21.2 In the event Lessor elects either to terminate this Lease or to terminate Lessee's right to possession of the Demised Premised upon the occurrence of an Event of Default, then, to the extent permitted by applicable law, all licenses, certifications, permits and authorizations issued by any governmental agency, body or authority in connection with or relating to the Facilities and the nursing homes operated thereon shall be deemed as being assigned to Lessor.

(Id. at D02376.)

The Master Lease included a provision, Article 36, for the transfer of operations upon termination of the lease.Article 36 provides, in relevant part:

ARTICLE 36—TRANSFER OF OPERATIONS UPON TERMINATION OF LEASE

36.1 The date on which this Lease either terminates or expires pursuant to its terms or is terminated by either party whether pursuant to a right granted to it hereunder or otherwise shall be referred to as the “Closing Date” in this Article.On the Closing Date, this Lease shall be deemed and construed as an absolute assignment for the purposes of vesting in Lessor (or Lessor's designee) all of Lessee's right, title and interest in and to the following intangible property which is now or hereafter used in connection with the operation of the Demised Premises (the “Intangibles”) and an assumption by Lessor of Lessee's obligations under the Intangibles from and after the Closing Date ...:

(1) service contracts ... for the benefit of the Demised Premises to which Lessee is a party, and which can be terminated without penalty by Lessee within sixty (60) or fewer days' notice or which Lessor requests be assigned to Lessor pursuant to this Article 36.

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36.2 Lessor shall be responsible for and shall pay all accrued expenses with respect to the Demised Premises accruing on or after 12:01 a.m. on the day of the Closing Date and shall be entitled to receive and retain all revenues from the Demised Premises accruing on or after the Closing Date.

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36.4 For the period commencing on the Closing Date and ending on the date Lessor, or its designee, obtains any and all appropriate state or other governmental licenses and certifications required to operate the Facilities, Lessee hereby agrees that Lessor, or Lessor's designee, shall have the right, but not the obligation, to manage and operate the Demised Premises, on a triple net basis, and shall be entitled to all revenues of the Demised Premises during such period, and to use any and all licenses, certifications and provider agreements issued to Lessee by any federal, state or other governmental authority for such operation of the Demised Premises, if permitted by any such governmental authorities.If Lessor or its designee exercises the right described above in this Section 36.4, the provisions of this Section 36.4 shall be self-operative and shall constitute a management agreement between Lessee, on the one hand, and Lessor or its designee, on the other hand, on the terms set forth above in this Section 36.4 provided, however, that upon the request of Lessor or its designee, Lessee shall enter into a separate management agreement on the terms set forth in this Section 36.4 and on such other terms and provisions as may be specified by Lessor or its designee.

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36.6 All cash, checks and cash equivalent at the Demised Premises and deposits in bank accounts (other than patient trust accounts) relating to the Demised Premises on the Closing Date shall remain Lessee's property after the Closing Date.Subject to the provisions of Article 24 hereof, all accounts receivable, loans receivable and other receivables of Lessee, whether derived from operation of the Demised Premises or otherwise, shall remain the property of Lessee after the Closing Date.Lessee shall retain full responsibility for the collection thereof.Lessor shall assume responsibility for the billing and collection of payments on account of services rendered by it on and after the Closing Date.In order to facilitate Lessee's collection efforts, Lessee agrees to deliver to Lessor, within a reasonable time after the Closing Date, a schedule identifying all of those private pay balances owing for the month prior to the Closing Date and Lessor agrees to apply any payments received which are specifically designated as being applicable to services rendered prior to the Closing Date to reduce the pre-Closing Date balances of said patients by promptly remitting said payments to Lessee.All other payments received shall be retained by Lessor as being applicable to services rendered after the Closing Date.Lessor shall cooperate with Lessee in Lessee's collection of its

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