The village of Melrose Park, Ill., has filed a lawsuit against Los Angeles-based Pipeline Health, alleging the company made fraudulent misrepresentations when it acquired Westlake Hospital in Melrose Park, according to the Chicago Tribune.
The lawsuit alleges Pipeline Health and its owners promised to keep Westlake Hospital open when they were buying it and two other hospitals from Dallas-based Tenet Healthcare. However, Pipeline revealed plans to close Westlake Hospital a few weeks after the transaction closed.
The lawsuit further alleges Pipeline kept its plans to shut down the 230-bed hospital secret until after the transaction closed to avoid opposition from village leaders and community members.
In a statement to the Chicago Tribune, Pipeline called the lawsuit "defamatory and false."
"Pipeline Health's plans are to invest in the patients, not buildings," Pipeline said. "As will be discussed in the regulatory process, the proper forum for this debate, Westlake Hospital has been deprived of state funding for years, is losing millions of dollars each month and draining resources from primary care as well as from West Suburban and Weiss Hospitals."
In its application to close Westlake Hospital, Pipeline said it plans to invest $2.5 million in more outpatient care in Melrose Park after the hospital shuts down.
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