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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
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PEOPLE OF THE STATE OF NEW YORK by Index No. ___________
LETITIA JAMES, Attorney General of the
State of New York,
Petitioner, ORDER TO SHOW CAUSE
WITH MOTION FOR
PRELIMINARY INJUNCTION
AND EXPEDITED HEARING
-against-
ABRAHAM OPERATIONS ASSOCIATES
LLC d/b/a BETH ABRAHAM CENTER
FOR REHABILITATION AND NURSING,
DELAWARE OPERATIONS ASSOCIATES LLC
d/b/a BUFFALO CENTER FOR REHABILITATION
AND NURSING, HOLLIS OPERATING CO., LLC
d/b/a HOLLISWOOD CENTER FOR REHABILITATION
AND HEALTHCARE, SCHNUR OPERATIONS
ASSOCIATES LLC d/b/a MARTINE
CENTER FOR REHABILITATION AND NURSING,
LIGHT PROPERTY HOLDINGS ASSOCIATES LLC,
DELAWARE REAL PROPERTY ASSOCIATES LLC,
HOLLIS REAL ESTATE CO., LLC,
LIGHT OPERATIONAL HOLDINGS ASSOCIATES LLC,
LIGHT PROPERTY HOLDINGS II ASSOCIATES LLC,
CENTERS FOR CARE LLC d/b/a CENTERS HEALTH CARE,
CFSC DOWNSTATE, LLC, BIS FUNDING CAPITAL LLC,
SKILLED STAFFING, LLC, KENNETH ROZENBERG, DARYL HAGLER,
BETH ROZENBERG, JEFFREY SICKLICK, REUVEN KAUFMAN,
LEO LERNER, AMIR ABRAMCHIK, DAVID GREENBERG,
ELLIOT KAHAN, SOL BLUMENFELD, ARON GITTLESON,
AHARON LANTZITSKY,
JONATHAN HAGLER, and MORDECHAI “MOTI” HELLMAN,
Respondents.
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Upon reading and filing the annexed Verified Petition with Exhibits; Affirmation in
Support of Petitioner’s Verified Petition, with Exhibits, of Todd Pettigrew, Special Assistant
Attorney General, dated June 28, 2023, Affirmation in Support of Petitioner’s Order to Show
Cause for a Preliminary Injunction and Appointment of a Monitor, with Exhibits, of Todd
Pettigrew, Special Assistant Attorney General, dated June 28, 2023; the Affidavits of Remy
Allen, Alice Barner, Jerinae Basden, Joy Battison, Omayra Benitez, Aniwang Berrie, Elan
Bonnema, Marilyn Burke, Louis Clark, Carrie Craft, Patricia Dragovic, Marie Dunn, Danielle
Erick, Carla Forgione, Jill Franklin, Bianca Gutzmore, Susy Holguin, Antonietta Johnson, Sheryl
Johnson, Kevin Jones, Carol Ann Lasalle, Yvonne Latty, Angela Lawrence, Kaiona Murray
Evans, Anna Maria Naimoli, Noemi Oppenheimer, Thomas Passaro, Jr., Dorothy Pietraszewski,
Mary Pinks, Nicholas Powers, James E. Quinn, Jr., Lisa Revell, Marlene Rodriquez, Aurea Rosa,
Tyrone Salazar, Louis Salvio, Lauren Schneider, Larry J. Scinta, Jr., Jocelyn Smith, Rose Smith,
Diane Snyder, Floyd David Snyder, Jr., Awilda Solas-Santiago, Cherell Toe, Catherine
Vanacore, Cynthia Vega, Evelynn White, Jennie White, and Talia Wong; Regional Chief
Auditor-Investigator Dejan Budimir, Principal Supervising Auditor-Investigator Ann Winslow,
Principal Auditor-Investigators Kizzy-Ann Waldropt and Christine Rhody, and Senior Auditor-
Investigators Siobhan O’Leary and Christopher Giacoia, Detectives Timothy Bates, Peter Olsen,
Katie O’Neill, Scott Petucci, and David Ras; the accompanying Memorandum of Law and upon
the motion of LETITIA JAMES, Attorney General of the State of New York, for Petitioner, the
People of the State of New York, it is hereby ordered that Respondents in this proceeding show
cause at the Supreme Court, New York County, 60 Centre Street, New York, on the ___th day of
July 2023, at 9:30 a.m., or as soon thereafter as counsel may be heard, why an order and
judgment should not be made pursuant to Executive Law §§ 63(12), granting the following
relief:
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Declaratory Relief
1. Declaring that:
a. Respondents have engaged in repeated and persistent fraud in the carrying on,
conducting, and transaction of business, in violation of Executive Law §63(12);
b. Respondents have repeatedly and persistently engaged in illegal acts in the
carrying on, conducting, and transaction of business, in violation of Executive
Law §63(12), by engaging in the financial fraud alleged in the Verified Petition,
and in the operation of the four skilled nursing facilities that are the subject of the
instant Special Proceeding, to wit, Beth Abraham Center for Rehabilitation and
Nursing, Buffalo Center for Rehabilitation and Nursing, Holliswood Center for
Rehabilitation and Healthcare, and Martine Center for Rehabilitation and Nursing
(collectively, the “Nursing Homes”), by illegally failing to deliver required care;
and
c. Respondents have obtained, received, converted, and/or disposed of Medicaid
funds, directly or indirectly, to which they were not entitled.
Permanent Injunctive Relief
2. Permanently enjoining Respondents from:
a. Further violating healthcare regulations relating to nursing home services in New
York State;
b. Further engaging in the illegal and fraudulent practices alleged in the Verified
Petition;
c. Engaging in fraudulent and illegal acts and practices relating to reimbursement by
the New York State Medicaid Program and federal Medicare Program;
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d. Admitting or allowing to be admitted to the Nursing Homes new residents until
the Nursing Homes’ Operators1 provide signed certifications to the Attorney
General certifying that that an identified clinician has determined that the Nursing
Homes’ Operators have met their obligations to ensure: sufficient care and
staffing for all existing residents and for any new residents, and that each Nursing
Home’s minimum staffing level meets 4.1 Hours Per Resident Day (“HPRD”) and
0.75 HPRD from Registered Nurse (“RN”) staff; and that the Nursing Homes are
otherwise fully complying with all New York State laws regarding minimum
staffing levels and spending on direct care staff; and
e. Filing false, incomplete, or misleading Cost Reports with DOH.
3. Directing Respondents to correct the Nursing Homes’ false and misleading cost reports for
2018, 2019, 2020, and 2021 by October 25, 2023, and to submit to MFCU such revisions;
4. Appointing a financial monitor to oversee the Nursing Homes’ financial operations, prevent
the Nursing Homes from making collusive and self-dealing payments to Respondents, and
cause the Nursing Homes to terminate loans with Related Parties; and granting the financial
monitor specific authority to withhold any payments to any Respondent and any other
Related Parties2;
5. Appointing an independent healthcare monitor with the specific authority to visit and inspect
the Nursing Homes at any time, to review all documents maintained by Respondents
regarding the Nursing Homes, to oversee healthcare operations at the Nursing Homes, to
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Abraham Operations Associates LLC, d/b/a Beth Abraham Center for Rehabilitation and Nursing; Delaware
Operations Associates LLC, d/b/a Buffalo Center for Rehabilitation and Nursing; Hollis Operating Co., LLC d/b/a
Holliswood Center for Rehabilitation and Healthcare; and Schnur Operations Associates LLC, d/b/a Martine Center
for Rehabilitation and Nursing, collectively, shall be referred to as the “Nursing Homes’ Operators.”
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The term “Related Parties” shall have the same meaning as that set forth in the Verified Petition at f.n. 79.
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make recommendations to improve the Nursing Homes compliance with their legal duties
under state and federal law, and to enable the Nursing Homes to provide required care to all
residents, and to ensure that the Nursing Homes take all necessary steps to avoid preventable
neglect and improve healthcare outcomes for their residents;
Monetary Relief
6. Directing all Respondents except the Nursing Homes to pay for the expenses of the monitors
appointed hereunder, and to pay for the Nursing Homes’ implementation of the monitors’
recommendations;
7. Directing Respondents to provide to MFCU a complete accounting of all monies wrongfully
received;
8. Directing that each Respondent disgorge to MFCU, for return to Medicaid, all monies
wrongfully received, as a result of Respondents’ conversion of Medicaid funds, and/or unjust
enrichment, within 30 days;
9. Directing all Respondents, except the Nursing Homes, pay restitution and/or damages to New
York State;
10. Directing all Respondents, except the Nursing Homes, to reimburse the State for the costs of
this investigation;
11. Directing each Respondent, except the Nursing Homes, to pay statutory costs in the amount
of $2,000 pursuant to CPLR § 8303(a)(6); and
12. Directing each Respondent to notify Petitioner of any change to Respondents’ addresses
within five days of such change; and
Preliminary Relief
13. During the pendency of this proceeding:
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a. Granting a preliminary injunction pursuant to Executive Law § 63(12), (i)
enjoining all Respondents from engaging in any fraudulent, deceptive, or illegal
acts in violation of Executive Law § 63(12), including but not limited to
violations of the Public Health Law and those regulations promulgated to promote
and ensure the wellbeing of nursing home residents; (ii) enjoining all Respondents
from obtaining, receiving, converting, and/or disposing of Medicaid funds,
directly or indirectly, to which they are not entitled; (iii) enjoining Respondents
Kenneth Rozenberg, Daryl Hagler, Centers for Care LLC d/b/a Centers Health
Care, Abraham Operations Associates LLC d/b/a Beth Abraham Center For
Rehabilitation And Nursing (“Beth Abraham”), Delaware Operations Associates
LLC d/b/a Buffalo Center For Rehabilitation And Nursing (“Buffalo Center”),
Hollis Operating Co., LLC d/b/a Holliswood Center For Rehabilitation And
Healthcare (“Holliswood”), Schnur Operations Associates LLC d/b/a Martine
Center For Rehabilitation And Nursing (“Martine Center”), Jeffrey Sicklick, Amir
Abramchik, and Aron Gittleson from filing false and/or misleading Cost Reports;
and (iv) enjoining Respondents Kenneth Rozenberg, Daryl Hagler, Centers for
Care LLC d/b/a Centers Health Care, Abraham Operations Associates LLC d/b/a
Beth Abraham Center For Rehabilitation And Nursing (“Beth Abraham”),
Delaware Operations Associates LLC d/b/a Buffalo Center For Rehabilitation
And Nursing (“Buffalo Center”), Hollis Operating Co., LLC d/b/a Holliswood
Center For Rehabilitation And Healthcare (“Holliswood”), Schnur Operations
Associates LLC d/b/a Martine Center For Rehabilitation And Nursing (“Martine
Center”), Jeffrey Sicklick, Amir Abramchik, and Aron Gittleson from transferring
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any assets to the following entities: BIS Funding LLC, Skilled Staffing LLC, and
CFSC Downstate, LLC.
b. Appointing an independent healthcare monitor for the pendency of this action to
oversee compliance with the preliminary injunction, including oversight of the
healthcare functions at the Nursing Homes. The details of such a proposal appear
in Exhibit A hereto.
c. Appointing an independent financial monitor for the pendency of this action to
ensure compliance with this injunction, including review of the financial
condition of the Nursing Homes, and BIS Funding LLC, Skilled Staffing LLC,
and CFSC Downstate LLC (“Related Party Vendors”), to ensure that the Nursing
Homes maintain sufficient funds to: a) fund the operations of the Nursing Homes,
in accordance with all applicable laws, rules, and regulations, b) implement the
recommendations of the independent healthcare monitor and c) ensure
compliance with this Order, including but not limited to, the prohibitions against
the Nursing Homes transferring assets, directly or indirectly, to the Related Party
Vendors;
And further:
14. Directing Respondents to file an answer or motion to dismiss, pursuant to CPLR §§ 403(b),
(d) and 404, within 30 days of the date of a decision and order upon Petitioner’s request for a
preliminary injunction; directing Petitioner to reply to said answer or motion to dismiss, if it
so chooses, within 30 days of this Order; and directing the Parties to appear before the Court,
Honorable ____________, Justice of the Supreme Court, or any other Justice of this Court as
may be directed, at Part _____ in Room _____, at the courthouse located at 60 Centre Street,
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New York, NY, or at any other place as this Court may direct, for a hearing on said papers on
or about _____ at _____ a.m./p.m., and on any adjourned date and time thereafter; and
15. Such other and further relief as the Court may deem just and proper.
SUFFICIENT CAUSE BEING ALLEGED THEREFOR,
ORDERED that service of a copy of this Order, and the papers on which it is granted by
electronic mail at ms@centricitylaw.com or Secure Cloud link to Respondents’ counsel, Motty
Shulman, Esq., on or before _________________, be deemed good and sufficient service hereof;
ENTER
_______________________________
J. S. C.
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EXHIBIT A
Order to Show Cause: Exhibit A (Proposed Monitorship for Preliminary Injunction)
Independent Healthcare Monitor
1) Within 5 days of this Order, Respondents shall retain an Independent Healthcare
Monitor (“IHM”), to verify, survey, inspect, and improve the delivery of healthcare at the Nursing
Homes. MFCU recommends that the Court select the following candidate to be the IHM:
• David Hoffman and Associates, P.C.
2) The IHM will have the powers described herein until and unless this Order is
superseded by a subsequent Order of this Court. The IHM may retain additional personnel,
including but not limited to independent consultants, if needed to help meet the IHM’s obligations
under this Order. The IHM may confer and correspond with Petitioner and/or Respondents,
including the Nursing Homes, individually or together. The IHM and Respondents shall not
negotiate or enter into a financial relationship, other than the monitoring engagement required by
this Order, and the IHM shall refrain from recruiting and/or hiring any employee of the Nursing
Homes or the other Respondent entities for one year after the expiration of this Order.
3) The IHM is not an agent of MFCU.
4) Nothing herein shall be construed as deeming the IHM or MFCU to be an Operator
of the Nursing Homes.
5) Scope of Monitorship. The IHM shall be responsible for assessing and making
recommendations regarding the following:
a) The Nursing Homes’ internal quality control systems, including but not limited
to:
i) Whether the systems in place to promote quality of care and to
respond to quality-of-care problems operate in a timely and effective
manner;
ii) Whether the communication system is effective, allowing for
accurate information, decisions, and results of decisions to be transmitted
to the proper individuals in a timely fashion;
iii) Whether the Nursing Homes have the ability to analyze outcome
measures, such as CMS Quality Indicators, and other data; and
iv) Whether the training programs are effective, thorough, and
competency-based.
b) The Nursing Homes’ staffing, including:
i) Whether the Nursing Homes operate with sufficient CNA, LPN, and
RN staffing to comply with New York State law and to provide all required
care to the Nursing Homes’ existing residents and any proposed new
admissions;
ii) Whether the Nursing Homes have sufficient supervisory nursing
staff, including but not limited to RNs to provide sufficient training,
supervision, and support of staff, develop individualized care plans and
update such, and perform necessary resident assessments and other clinical
duties that only an RN is authorized to provide.
c) The Nursing Homes’ systems for review of their own compliance with staffing
requirements, including but not limited to limiting and/or barring the Nursing
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Homes’ proposed new admissions and/or readmissions when appropriate to
maintain sufficient staffing, as described above in Section 5(b)(1).
d) The Nursing Homes’ response to quality-of-care issues, which shall include an
assessment of:
i) The Nursing Homes’ ability to identify the problem;
ii) The Nursing Homes’ ability to determine the scope of the problem,
including but not limited to whether the problem is isolated or systemic;
iii) The Nursing Homes’ ability to conduct a root cause analysis;
iv) The Nursing Homes’ ability to create an action plan to respond to
the problem;
v) The Nursing Homes’ ability to execute the action plan; and
vi) The Nursing Homes’ ability to monitor and evaluate whether the
assessment, action, plan, and execution of that plan was effective, reliable,
and thorough.
e) Whether residents receive care in accordance with:
i) Professionally recognized standards of health care;
ii) Federal and New York State laws and regulations;
iii) DOH, CDC, CMS, and OMIG directives and other guidance;
iv) The Nursing Homes’ own policies, providing said policies are
clinically appropriate, and if they are not, identifying clinically appropriate
policies; and
v) The IHM’s recommendations, discussed in ¶ 9.
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6) On-Site Visits. In furtherance of the responsibilities described above, the IHM shall
visit each of the Nursing Homes, as needed and within the IHM’s discretion.
7) Access. The IHM shall have:
a) Immediate access to the Nursing Homes, at any time and without prior notice
to perform its duties and responsibilities, including but not limited to assessing
compliance with this Order, assessing the effectiveness of the internal quality
assurance mechanisms, and ensuring that the data being generated is accurate and
complete;
b) Real-time, uninterrupted remote access to all of the Nursing Homes’ Electronic
Medical Records (“EMR”), including but not limited to therapy records and Point
of Care systems; and the highest-level access permissions to such systems to enable
viewing of all edits made at any time to any records by any user, person, or systems
administrator, including but not limited to:
i) The times of scheduled medication and/or treatment administration;
ii) The purported times of medication and/or treatment administration;
and
iii) The accompanying metadata.
c) Immediate access to the following documents maintained in any location,
including but not limited to:
i) CMS Quality Indicators;
ii) Internal or external surveys, mock surveys, audits, and/or reports;
iii) Complaints and/or grievances from any resident, family member,
and/or staff member;
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iv) Resident satisfaction surveys;
v) Staffing data in the format requested by the IHM;
vi) Documentation regarding, or reports of, abuse, neglect, or any
incident that required hospitalization or emergency room treatment;
vii) Documentation regarding, or reports of, any falls;
viii) Documentation regarding, or reports of, any incident that prompts a
facility investigation;
ix) Resident records in the format requested by the IHM, without the
need for written resident consent or notice to any residents, family members,
or other guardians or representatives;
x) Documents in the possession or control of any quality assurance
committee, or other committees of the Nursing Homes; and
xi) Any other data in the format the IHM determines relevant to
fulfilling the duties required under this Order.
d) Immediate access to residents and staff members, and where necessary, access
to residents and staff members outside the presence of Respondents, Respondents’
counsel, and the Nursing Homes’ supervisory staff, provided all such interviews
are conducted in accordance with all applicable laws and the rights of such
individuals.
8) Obligations for the Nursing Homes. The Nursing Homes shall:
a) Fully and promptly cooperate with the IHM and shall ensure that the Nursing
Homes’ officers, employees, and agents fully and promptly cooperate with the
IHM.
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b) Immediately, and in any event, no later than within 12 hours of each of the
following occurrences, notify the IHM and MFCU, in writing (in addition to
following all other legal reporting obligations):
i) Deaths or injuries related to use of restraints;
ii) Deaths related to falls;
iii) Deaths or injuries related to medications errors;
iv) Deaths or injuries related to abuse or neglect (as defined in
applicable federal and state guidelines);
v) Alleged sexual assaults; and
vi) Any other incident that causes actual harm to a resident when such
incident is required to be reported to any local, state, or federal government
agency or presents an imminent danger to the health, safety, or well-being
of residents or places residents unnecessarily in high-risk situations.
c) Each such written notification shall contain, if applicable, the full name and
date of birth of the resident(s) involved, the staff involved, the date of death or
incident, actions taken to address the situation, and a summary of any related reports
made to federal, state, or local regulatory or enforcement agencies or to professional
licensing bodies.
d) Provide copies of such reports to their compliance officer.
9) IHM Proposed Corrective Action. To effectuate the IHM’s responsibilities, as set
forth herein, the IHM shall make recommendations to the Nursing Homes. All such
recommendations shall be made in writing and submitted by email to the Administrator of the
facility to which the recommendation relates, with a copy to Respondents and Petitioner, in the
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manner described in ¶ 32. The Nursing Homes shall implement all recommendations made by the
IHM within five (5) business days, unless the Nursing Homes produce documentation that good
cause exists to decline to follow the IHM’s recommendations within the five (5) days. For the
purposes of this Order, “good cause” shall not include any objection based solely on the expense
or loss of revenue from implementing the recommendation. If any of the Nursing Homes refuses
to implement any such recommendation (either by objecting or taking no action), the IHM shall
notify Petitioner by email and send any documented explanation, within three (3) business days of
such refusal. Petitioner shall review the documented explanation and, in writing, either (a) apprise
the IHM and the Nursing Home that Petitioner accepts the Nursing Home’s explanation and rejects
the IHM’s recommendation; or (b) that the Nursing Home must implement the recommendation.
10) Funding of IHM’s Expenses, including implementation of Recommendations.
Respondents shall:
a) Pay for the cost of, and the expenses incurred by, the IHM in connection with
this Order, including but not limited to labor costs (direct and indirect); consultant
and subcontractor costs; materials costs (direct and indirect); and other direct costs
(travel, other miscellaneous); and
b) Pay the IHM’s invoices within 15 days of submission to the Nursing Homes by
the IHM. Respondents’ failure to pay the IHM within 15 days shall be considered
a violation of this Order.
11) The IHM shall charge a reasonable amount for its fees and expenses, and shall
submit monthly invoices to Respondents, by email as described in ¶ 32(b), with a reasonable level
of detail reflecting all key category costs billed.
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12) At no point shall the payment of the IHM be drawn or otherwise derived from the
funds or operating accounts of the Nursing Homes.
13) Respondents shall not fund the expenses set forth herein with Medicaid or Medicare
payments made to the Nursing Homes or Medicaid or Medicare payments made to any other
nursing home individually or partly owned by any of the Respondents.
14) Violations of this Order. In the event that Respondents violate this Order, the IHM
shall inform the Court of such violation in writing, with a copy to MFCU, within five (5) business
days of the violation. Upon a determination by the Court that Respondents have violated this
Order, the Court shall impose a fine of Five Thousand dollars ($5,000.00) per day retroactive to
the date the conduct constituting the violation occurred and, such fines shall accrue until the
violation is remedied (including payment in full of any outstanding or accrued fines), as
determined by the Court; or any such other relief that this Court deems proper.
Independent Financial Monitor
15) Within 5 days of this Order, Respondents shall retain an Independent Financial
Monitor (“IFM”), to verify Respondents’ compliance with all terms of this Order that bear, in any
respect, on the financial condition of the Nursing Homes and the requirements under this Order,
including but not limited to:
a) Expenditures required or prohibited pursuant to this Order;
b) Compliance with this Order; and
c) Sufficiency of expenditures to implement the recommendations of the IHM under
this Order.
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16) The Court shall select the IFM from one of the following potential candidates
provided by MFCU:
• Elyse Ruzow, Ruzow & Associates
• Robert H. Silbering (T&M, USA, LLC)
17) The IFM will have the powers described herein until and unless this Order is
superseded by a subsequent Order of this Court. The IFM may retain additional personnel,
including but not limited to independent consultants, if needed to help meet the IFM’s obligations
under this Order. The IFM may confer and correspond with Petitioner and/or Respondents,
including the Nursing Homes, individually or together. The IFM and Respondents shall not
negotiate or enter into a financial relationship, other than the monitoring engagement required by
this Order, and the IFM shall refrain from recruiting and/or hiring any employee of the Nursing
Homes or the other Respondent entities for one year after the expiration of this Order.
18) The IFM is not an agent of MFCU.
19) Nothing herein shall be construed as deeming the IFM or MFCU to be an Operator
of the Nursing Homes.
20) Scope of Monitorship. The IFM shall be responsible for reviewing the financial
condition of the Nursing Homes, and BIS Funding LLC, Skilled Staffing LLC, and CFSC
Downstate LLC (“Related Party Vendors”) to ensure that the Nursing Homes maintain sufficient
funds to: a) fund the Operations of the Nursing Homes, in accordance with all applicable laws,
rules, and regulations, b) implement the recommendations of the IHM, and c) ensure compliance
with this Order, including but not limited to, the prohibitions against the Nursing Homes
transferring assets, directly or indirectly, to the Related Party Vendors.
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21) The IFM shall have the power, in its discretion, to issue recommendations to the
Nursing Homes and the Related Party Vendors to effectuate the terms of this Order, included but
not limited to:
a) Preventing, blocking, canceling, reversing or modifying the terms of any financial
transaction that would cause the Nursing Homes and/or Related Party Vendors to
violate this Order; and
b) Instructing or directing financial transactions necessary to effectuate the terms of
this Order.
22) On-Site Visits. In furtherance of the responsibilities described above, the IFM shall
visit each of the Nursing Homes, as needed and within the IFM’s discretion.
23) Access. The IFM shall have:
a) Unconditional access to view all information concerning the Nursing Homes’
finances, including, but not limited to, direct electronic access to the bank accounts
of the Related Party Vendors and the Nursing Homes.
b) Unconditional access to, and/or copies of (in the format requested by the IFM),
the books and records of the Nursing Homes and the Related Party Vendors, as well
as unconditional access to any accountant or accounting firm for the Nursing
Homes and the Related Party Vendors, which, in the IFM’s sole discretion, is
necessary to carry out the IFM’s responsibilities.
24) Obligations for the Nursing Homes and Related Party Vendors. The Nursing
Homes and Related Party Vendors shall fully and promptly cooperate with the IFM and shall
ensure that the Nursing Homes’ and Related Party Vendors’ officers, employees, and agents fully
and promptly cooperate with the IFM.
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25) IFM Proposed Corrective Action. To effectuate the IFM’s responsibilities, as set
forth herein, the IFM shall make recommendations to the Nursing Homes and Related Party
Vendors. All such recommendations shall be made in writing and submitted by email to the
Administrator of the facility to which the recommendation relates, with a copy to Respondents and
Petitioner, in the manner described in ¶ 32. The Nursing Homes and Related Party Vendors shall
implement all recommendations made by the IFM within five (5) business days, unless they
produce documentation that good cause exists to decline to follow the IFM’s recommendations
within the five (5) days. If any of the Nursing Homes refuses to implement any such
recommendation (either by objecting or taking no action), the IFM shall notify Petitioner by email
and send any documented explanation, within three (3) business days of such refusal. Petitioner
shall review the documented explanation and, in writing, either (a) apprise the IFM and the Nursing
Home/Related Party Vendor that Petitioner accepts the Nursing Home’s/Related Party Vendor’s
explanation and rejects the IFM’s recommendation; or (b) that the Nursing Home/Related Party
Vendor must implement the recommendation.
26) It shall be a violation of this order:
a) If any of the Nursing Homes or Related Party Vendors fails to implement any
recommendation of the IFM within five (5) business days of the IFM issuing it (or
other reasonable period of time set by the IFM); or
b) If any of the Nursing Homes or Related Party Vendors fails to implement any
recommendation within five (5) business days of MFCU’s determination to affirm
an IFM recommendation (as described in ¶ 25(b)).
27) Funding of IFM’s Expenses, including implementation of Recommendations.
Respondents shall:
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a) Pay for the cost of, and the expenses incurred by, the IFM in connection with
this Order, including but not limited to labor costs (direct and indirect); consultant
and subcontractor costs; materials costs (direct and indirect); and other direct costs
(travel, other miscellaneous); and
b) Pay the IFM’s invoices within 15 days of submission to the Nursing Homes
and/or Related Party Vendors by the IFM. Respondents’ failure to pay the IHM
within 15 days shall be considered a violation of this Order.
28) The IFM shall charge a reasonable amount for its fees and expenses, and shall
submit monthly invoices to Respondents, by email, as described in ¶ 32(b), with a reasonable level
of detail reflecting all key category costs billed.
29) At no point shall the payment of the IFM be drawn or otherwise derived from the
funds or operating accounts of the Nursing Homes.
30) Respondents shall not fund the expenses set forth herein with Medicaid payments
made to the Nursing Homes or Medicaid payments made to any other nursing home individually
or partly owned by any of the Respondents.
31) Violations of this Order. In the event that Respondents violate this Order, the IFM
shall inform the Court of such violation in writing, with a copy to MFCU, within five (5) business
days of the violation. Upon a determination by the Court that Respondents have violated this
Order, the Court shall impose a fine of Five Thousand dollars ($5,000.00) per day shall until the
violation is remedied (including payment in full of any outstanding or accrued fines), as
determined by the Court; or any such other relief that this Court deems proper.
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Notices
32) Any notices pursuant to this Order shall be in writing and shall be sent by email, as
follows:
a) TO PETITIONER: MFCUNotices@ag.ny.gov;
b) TO RESPONDENTS: ___________________;
c) TO THE ADMINISTRATORS:
i) Beth Abraham Center: _____________________;
ii) Buffalo Center: _________________________;
iii) Holliswood Center: _______________________; and
iv) Martine Center: ___________________________.
END OF EXHIBIT A
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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK --------------------------------------------------------------------X PEOPLE OF THE STATE OF NEW YORK by Index No. ___________ LETITIA JAMES, Attorney General of the State of New York, Petitioner, ORDER TO SHOW CAUSE WITH MOTION FOR PRELIMINARY INJUNCTION AND EXPEDITED HEARING -against- ABRAHAM OPERATIONS ASSOCIATES LLC d/b/a BETH ABRAHAM CENTER FOR REHABILITATION AND NURSING, DELAWARE OPERATIONS ASSOCIATES LLC d/b/a BUFFALO CENTER FOR REHABILITATION AND NURSING, HOLLIS OPERATING CO., LLC d/b/a HOLLISWOOD CENTER FOR REHABILITATION AND HEALTHCARE, SCHNUR OPERATIONS ASSOCIATES LLC d/b/a MARTINE CENTER FOR REHABILITATION AND NURSING, LIGHT PROPERTY HOLDINGS ASSOCIATES LLC, DELAWARE REAL PROPERTY ASSOCIATES LLC, HOLLIS REAL ESTATE CO., LLC, LIGHT OPERATIONAL HOLDINGS ASSOCIATES LLC, LIGHT PROPERTY HOLDINGS II ASSOCIATES LLC, CENTERS FOR CARE LLC d/b/a CENTERS HEALTH CARE, CFSC DOWNSTATE, LLC, BIS FUNDING CAPITAL LLC, SKILLED STAFFING, LLC, KENNETH ROZENBERG, DARYL HAGLER, BETH ROZENBERG, JEFFREY SICKLICK, REUVEN KAUFMAN, LEO LERNER, AMIR ABRAMCHIK, DAVID GREENBERG, ELLIOT KAHAN, SOL BLUMENFELD, ARON GITTLESON, AHARON LANTZITSKY, JONATHAN HAGLER, and MORDECHAI “MOTI” HELLMAN, Respondents. --------------------------------------------------------------------X Upon reading and filing the annexed Verified Petition with Exhibits; Affirmation in Support of Petitioner’s Verified Petition, with Exhibits, of Todd Pettigrew, Special Assistant Attorney General, dated June 28, 2023, Affirmation in Support of Petitioner’s Order to Show Cause for a Preliminary Injunction and Appointment of a Monitor, with Exhibits, of Todd Pettigrew, Special Assistant Attorney General, dated June 28, 2023; the Affidavits of Remy Allen, Alice Barner, Jerinae Basden, Joy Battison, Omayra Benitez, Aniwang Berrie, Elan Bonnema, Marilyn Burke, Louis Clark, Carrie Craft, Patricia Dragovic, Marie Dunn, Danielle Erick, Carla Forgione, Jill Franklin, Bianca Gutzmore, Susy Holguin, Antonietta Johnson, Sheryl Johnson, Kevin Jones, Carol Ann Lasalle, Yvonne Latty, Angela Lawrence, Kaiona Murray Evans, Anna Maria Naimoli, Noemi Oppenheimer, Thomas Passaro, Jr., Dorothy Pietraszewski, Mary Pinks, Nicholas Powers, James E. Quinn, Jr., Lisa Revell, Marlene Rodriquez, Aurea Rosa, Tyrone Salazar, Louis Salvio, Lauren Schneider, Larry J. Scinta, Jr., Jocelyn Smith, Rose Smith, Diane Snyder, Floyd David Snyder, Jr., Awilda Solas-Santiago, Cherell Toe, Catherine Vanacore, Cynthia Vega, Evelynn White, Jennie White, and Talia Wong; Regional Chief Auditor-Investigator Dejan Budimir, Principal Supervising Auditor-Investigator Ann Winslow, Principal Auditor-Investigators Kizzy-Ann Waldropt and Christine Rhody, and Senior Auditor- Investigators Siobhan O’Leary and Christopher Giacoia, Detectives Timothy Bates, Peter Olsen, Katie O’Neill, Scott Petucci, and David Ras; the accompanying Memorandum of Law and upon the motion of LETITIA JAMES, Attorney General of the State of New York, for Petitioner, the People of the State of New York, it is hereby ordered that Respondents in this proceeding show cause at the Supreme Court, New York County, 60 Centre Street, New York, on the ___th day of July 2023, at 9:30 a.m., or as soon thereafter as counsel may be heard, why an order and judgment should not be made pursuant to Executive Law §§ 63(12), granting the following relief: 2 Declaratory Relief 1. Declaring that: a. Respondents have engaged in repeated and persistent fraud in the carrying on, conducting, and transaction of business, in violation of Executive Law §63(12); b. Respondents have repeatedly and persistently engaged in illegal acts in the carrying on, conducting, and transaction of business, in violation of Executive Law §63(12), by engaging in the financial fraud alleged in the Verified Petition, and in the operation of the four skilled nursing facilities that are the subject of the instant Special Proceeding, to wit, Beth Abraham Center for Rehabilitation and Nursing, Buffalo Center for Rehabilitation and Nursing, Holliswood Center for Rehabilitation and Healthcare, and Martine Center for Rehabilitation and Nursing (collectively, the “Nursing Homes”), by illegally failing to deliver required care; and c. Respondents have obtained, received, converted, and/or disposed of Medicaid funds, directly or indirectly, to which they were not entitled. Permanent Injunctive Relief 2. Permanently enjoining Respondents from: a. Further violating healthcare regulations relating to nursing home services in New York State; b. Further engaging in the illegal and fraudulent practices alleged in the Verified Petition; c. Engaging in fraudulent and illegal acts and practices relating to reimbursement by the New York State Medicaid Program and federal Medicare Program; 3 d. Admitting or allowing to be admitted to the Nursing Homes new residents until the Nursing Homes’ Operators1 provide signed certifications to the Attorney General certifying that that an identified clinician has determined that the Nursing Homes’ Operators have met their obligations to ensure: sufficient care and staffing for all existing residents and for any new residents, and that each Nursing Home’s minimum staffing level meets 4.1 Hours Per Resident Day (“HPRD”) and 0.75 HPRD from Registered Nurse (“RN”) staff; and that the Nursing Homes are otherwise fully complying with all New York State laws regarding minimum staffing levels and spending on direct care staff; and e. Filing false, incomplete, or misleading Cost Reports with DOH. 3. Directing Respondents to correct the Nursing Homes’ false and misleading cost reports for 2018, 2019, 2020, and 2021 by October 25, 2023, and to submit to MFCU such revisions; 4. Appointing a financial monitor to oversee the Nursing Homes’ financial operations, prevent the Nursing Homes from making collusive and self-dealing payments to Respondents, and cause the Nursing Homes to terminate loans with Related Parties; and granting the financial monitor specific authority to withhold any payments to any Respondent and any other Related Parties2; 5. Appointing an independent healthcare monitor with the specific authority to visit and inspect the Nursing Homes at any time, to review all documents maintained by Respondents regarding the Nursing Homes, to oversee healthcare operations at the Nursing Homes, to 1 Abraham Operations Associates LLC, d/b/a Beth Abraham Center for Rehabilitation and Nursing; Delaware Operations Associates LLC, d/b/a Buffalo Center for Rehabilitation and Nursing; Hollis Operating Co., LLC d/b/a Holliswood Center for Rehabilitation and Healthcare; and Schnur Operations Associates LLC, d/b/a Martine Center for Rehabilitation and Nursing, collectively, shall be referred to as the “Nursing Homes’ Operators.” 2 The term “Related Parties” shall have the same meaning as that set forth in the Verified Petition at f.n. 79. 4 make recommendations to improve the Nursing Homes compliance with their legal duties under state and federal law, and to enable the Nursing Homes to provide required care to all residents, and to ensure that the Nursing Homes take all necessary steps to avoid preventable neglect and improve healthcare outcomes for their residents; Monetary Relief 6. Directing all Respondents except the Nursing Homes to pay for the expenses of the monitors appointed hereunder, and to pay for the Nursing Homes’ implementation of the monitors’ recommendations; 7. Directing Respondents to provide to MFCU a complete accounting of all monies wrongfully received; 8. Directing that each Respondent disgorge to MFCU, for return to Medicaid, all monies wrongfully received, as a result of Respondents’ conversion of Medicaid funds, and/or unjust enrichment, within 30 days; 9. Directing all Respondents, except the Nursing Homes, pay restitution and/or damages to New York State; 10. Directing all Respondents, except the Nursing Homes, to reimburse the State for the costs of this investigation; 11. Directing each Respondent, except the Nursing Homes, to pay statutory costs in the amount of $2,000 pursuant to CPLR § 8303(a)(6); and 12. Directing each Respondent to notify Petitioner of any change to Respondents’ addresses within five days of such change; and Preliminary Relief 13. During the pendency of this proceeding: 5 a. Granting a preliminary injunction pursuant to Executive Law § 63(12), (i) enjoining all Respondents from engaging in any fraudulent, deceptive, or illegal acts in violation of Executive Law § 63(12), including but not limited to violations of the Public Health Law and those regulations promulgated to promote and ensure the wellbeing of nursing home residents; (ii) enjoining all Respondents from obtaining, receiving, converting, and/or disposing of Medicaid funds, directly or indirectly, to which they are not entitled; (iii) enjoining Respondents Kenneth Rozenberg, Daryl Hagler, Centers for Care LLC d/b/a Centers Health Care, Abraham Operations Associates LLC d/b/a Beth Abraham Center For Rehabilitation And Nursing (“Beth Abraham”), Delaware Operations Associates LLC d/b/a Buffalo Center For Rehabilitation And Nursing (“Buffalo Center”), Hollis Operating Co., LLC d/b/a Holliswood Center For Rehabilitation And Healthcare (“Holliswood”), Schnur Operations Associates LLC d/b/a Martine Center For Rehabilitation And Nursing (“Martine Center”), Jeffrey Sicklick, Amir Abramchik, and Aron Gittleson from filing false and/or misleading Cost Reports; and (iv) enjoining Respondents Kenneth Rozenberg, Daryl Hagler, Centers for Care LLC d/b/a Centers Health Care, Abraham Operations Associates LLC d/b/a Beth Abraham Center For Rehabilitation And Nursing (“Beth Abraham”), Delaware Operations Associates LLC d/b/a Buffalo Center For Rehabilitation And Nursing (“Buffalo Center”), Hollis Operating Co., LLC d/b/a Holliswood Center For Rehabilitation And Healthcare (“Holliswood”), Schnur Operations Associates LLC d/b/a Martine Center For Rehabilitation And Nursing (“Martine Center”), Jeffrey Sicklick, Amir Abramchik, and Aron Gittleson from transferring 6 any assets to the following entities: BIS Funding LLC, Skilled Staffing LLC, and CFSC Downstate, LLC. b. Appointing an independent healthcare monitor for the pendency of this action to oversee compliance with the preliminary injunction, including oversight of the healthcare functions at the Nursing Homes. The details of such a proposal appear in Exhibit A hereto. c. Appointing an independent financial monitor for the pendency of this action to ensure compliance with this injunction, including review of the financial condition of the Nursing Homes, and BIS Funding LLC, Skilled Staffing LLC, and CFSC Downstate LLC (“Related Party Vendors”), to ensure that the Nursing Homes maintain sufficient funds to: a) fund the operations of the Nursing Homes, in accordance with all applicable laws, rules, and regulations, b) implement the recommendations of the independent healthcare monitor and c) ensure compliance with this Order, including but not limited to, the prohibitions against the Nursing Homes transferring assets, directly or indirectly, to the Related Party Vendors; And further: 14. Directing Respondents to file an answer or motion to dismiss, pursuant to CPLR §§ 403(b), (d) and 404, within 30 days of the date of a decision and order upon Petitioner’s request for a preliminary injunction; directing Petitioner to reply to said answer or motion to dismiss, if it so chooses, within 30 days of this Order; and directing the Parties to appear before the Court, Honorable ____________, Justice of the Supreme Court, or any other Justice of this Court as may be directed, at Part _____ in Room _____, at the courthouse located at 60 Centre Street, 7 New York, NY, or at any other place as this Court may direct, for a hearing on said papers on or about _____ at _____ a.m./p.m., and on any adjourned date and time thereafter; and 15. Such other and further relief as the Court may deem just and proper. SUFFICIENT CAUSE BEING ALLEGED THEREFOR, ORDERED that service of a copy of this Order, and the papers on which it is granted by electronic mail at ms@centricitylaw.com or Secure Cloud link to Respondents’ counsel, Motty Shulman, Esq., on or before _________________, be deemed good and sufficient service hereof; ENTER _______________________________ J. S. C. 8 EXHIBIT A Order to Show Cause: Exhibit A (Proposed Monitorship for Preliminary Injunction) Independent Healthcare Monitor 1) Within 5 days of this Order, Respondents shall retain an Independent Healthcare Monitor (“IHM”), to verify, survey, inspect, and improve the delivery of healthcare at the Nursing Homes. MFCU recommends that the Court select the following candidate to be the IHM: • David Hoffman and Associates, P.C. 2) The IHM will have the powers described herein until and unless this Order is superseded by a subsequent Order of this Court. The IHM may retain additional personnel, including but not limited to independent consultants, if needed to help meet the IHM’s obligations under this Order. The IHM may confer and correspond with Petitioner and/or Respondents, including the Nursing Homes, individually or together. The IHM and Respondents shall not negotiate or enter into a financial relationship, other than the monitoring engagement required by this Order, and the IHM shall refrain from recruiting and/or hiring any employee of the Nursing Homes or the other Respondent entities for one year after the expiration of this Order. 3) The IHM is not an agent of MFCU. 4) Nothing herein shall be construed as deeming the IHM or MFCU to be an Operator of the Nursing Homes. 5) Scope of Monitorship. The IHM shall be responsible for assessing and making recommendations regarding the following: a) The Nursing Homes’ internal quality control systems, including but not limited to: i) Whether the systems in place to promote quality of care and to respond to quality-of-care problems operate in a timely and effective manner; ii) Whether the communication system is effective, allowing for accurate information, decisions, and results of decisions to be transmitted to the proper individuals in a timely fashion; iii) Whether the Nursing Homes have the ability to analyze outcome measures, such as CMS Quality Indicators, and other data; and iv) Whether the training programs are effective, thorough, and competency-based. b) The Nursing Homes’ staffing, including: i) Whether the Nursing Homes operate with sufficient CNA, LPN, and RN staffing to comply with New York State law and to provide all required care to the Nursing Homes’ existing residents and any proposed new admissions; ii) Whether the Nursing Homes have sufficient supervisory nursing staff, including but not limited to RNs to provide sufficient training, supervision, and support of staff, develop individualized care plans and update such, and perform necessary resident assessments and other clinical duties that only an RN is authorized to provide. c) The Nursing Homes’ systems for review of their own compliance with staffing requirements, including but not limited to limiting and/or barring the Nursing 2 Homes’ proposed new admissions and/or readmissions when appropriate to maintain sufficient staffing, as described above in Section 5(b)(1). d) The Nursing Homes’ response to quality-of-care issues, which shall include an assessment of: i) The Nursing Homes’ ability to identify the problem; ii) The Nursing Homes’ ability to determine the scope of the problem, including but not limited to whether the problem is isolated or systemic; iii) The Nursing Homes’ ability to conduct a root cause analysis; iv) The Nursing Homes’ ability to create an action plan to respond to the problem; v) The Nursing Homes’ ability to execute the action plan; and vi) The Nursing Homes’ ability to monitor and evaluate whether the assessment, action, plan, and execution of that plan was effective, reliable, and thorough. e) Whether residents receive care in accordance with: i) Professionally recognized standards of health care; ii) Federal and New York State laws and regulations; iii) DOH, CDC, CMS, and OMIG directives and other guidance; iv) The Nursing Homes’ own policies, providing said policies are clinically appropriate, and if they are not, identifying clinically appropriate policies; and v) The IHM’s recommendations, discussed in ¶ 9. 3 6) On-Site Visits. In furtherance of the responsibilities described above, the IHM shall visit each of the Nursing Homes, as needed and within the IHM’s discretion. 7) Access. The IHM shall have: a) Immediate access to the Nursing Homes, at any time and without prior notice to perform its duties and responsibilities, including but not limited to assessing compliance with this Order, assessing the effectiveness of the internal quality assurance mechanisms, and ensuring that the data being generated is accurate and complete; b) Real-time, uninterrupted remote access to all of the Nursing Homes’ Electronic Medical Records (“EMR”), including but not limited to therapy records and Point of Care systems; and the highest-level access permissions to such systems to enable viewing of all edits made at any time to any records by any user, person, or systems administrator, including but not limited to: i) The times of scheduled medication and/or treatment administration; ii) The purported times of medication and/or treatment administration; and iii) The accompanying metadata. c) Immediate access to the following documents maintained in any location, including but not limited to: i) CMS Quality Indicators; ii) Internal or external surveys, mock surveys, audits, and/or reports; iii) Complaints and/or grievances from any resident, family member, and/or staff member; 4 iv) Resident satisfaction surveys; v) Staffing data in the format requested by the IHM; vi) Documentation regarding, or reports of, abuse, neglect, or any incident that required hospitalization or emergency room treatment; vii) Documentation regarding, or reports of, any falls; viii) Documentation regarding, or reports of, any incident that prompts a facility investigation; ix) Resident records in the format requested by the IHM, without the need for written resident consent or notice to any residents, family members, or other guardians or representatives; x) Documents in the possession or control of any quality assurance committee, or other committees of the Nursing Homes; and xi) Any other data in the format the IHM determines relevant to fulfilling the duties required under this Order. d) Immediate access to residents and staff members, and where necessary, access to residents and staff members outside the presence of Respondents, Respondents’ counsel, and the Nursing Homes’ supervisory staff, provided all such interviews are conducted in accordance with all applicable laws and the rights of such individuals. 8) Obligations for the Nursing Homes. The Nursing Homes shall: a) Fully and promptly cooperate with the IHM and shall ensure that the Nursing Homes’ officers, employees, and agents fully and promptly cooperate with the IHM. 5 b) Immediately, and in any event, no later than within 12 hours of each of the following occurrences, notify the IHM and MFCU, in writing (in addition to following all other legal reporting obligations): i) Deaths or injuries related to use of restraints; ii) Deaths related to falls; iii) Deaths or injuries related to medications errors; iv) Deaths or injuries related to abuse or neglect (as defined in applicable federal and state guidelines); v) Alleged sexual assaults; and vi) Any other incident that causes actual harm to a resident when such incident is required to be reported to any local, state, or federal government agency or presents an imminent danger to the health, safety, or well-being of residents or places residents unnecessarily in high-risk situations. c) Each such written notification shall contain, if applicable, the full name and date of birth of the resident(s) involved, the staff involved, the date of death or incident, actions taken to address the situation, and a summary of any related reports made to federal, state, or local regulatory or enforcement agencies or to professional licensing bodies. d) Provide copies of such reports to their compliance officer. 9) IHM Proposed Corrective Action. To effectuate the IHM’s responsibilities, as set forth herein, the IHM shall make recommendations to the Nursing Homes. All such recommendations shall be made in writing and submitted by email to the Administrator of the facility to which the recommendation relates, with a copy to Respondents and Petitioner, in the 6 manner described in ¶ 32. The Nursing Homes shall implement all recommendations made by the IHM within five (5) business days, unless the Nursing Homes produce documentation that good cause exists to decline to follow the IHM’s recommendations within the five (5) days. For the purposes of this Order, “good cause” shall not include any objection based solely on the expense or loss of revenue from implementing the recommendation. If any of the Nursing Homes refuses to implement any such recommendation (either by objecting or taking no action), the IHM shall notify Petitioner by email and send any documented explanation, within three (3) business days of such refusal. Petitioner shall review the documented explanation and, in writing, either (a) apprise the IHM and the Nursing Home that Petitioner accepts the Nursing Home’s explanation and rejects the IHM’s recommendation; or (b) that the Nursing Home must implement the recommendation. 10) Funding of IHM’s Expenses, including implementation of Recommendations. Respondents shall: a) Pay for the cost of, and the expenses incurred by, the IHM in connection with this Order, including but not limited to labor costs (direct and indirect); consultant and subcontractor costs; materials costs (direct and indirect); and other direct costs (travel, other miscellaneous); and b) Pay the IHM’s invoices within 15 days of submission to the Nursing Homes by the IHM. Respondents’ failure to pay the IHM within 15 days shall be considered a violation of this Order. 11) The IHM shall charge a reasonable amount for its fees and expenses, and shall submit monthly invoices to Respondents, by email as described in ¶ 32(b), with a reasonable level of detail reflecting all key category costs billed. 7 12) At no point shall the payment of the IHM be drawn or otherwise derived from the funds or operating accounts of the Nursing Homes. 13) Respondents shall not fund the expenses set forth herein with Medicaid or Medicare payments made to the Nursing Homes or Medicaid or Medicare payments made to any other nursing home individually or partly owned by any of the Respondents. 14) Violations of this Order. In the event that Respondents violate this Order, the IHM shall inform the Court of such violation in writing, with a copy to MFCU, within five (5) business days of the violation. Upon a determination by the Court that Respondents have violated this Order, the Court shall impose a fine of Five Thousand dollars ($5,000.00) per day retroactive to the date the conduct constituting the violation occurred and, such fines shall accrue until the violation is remedied (including payment in full of any outstanding or accrued fines), as determined by the Court; or any such other relief that this Court deems proper. Independent Financial Monitor 15) Within 5 days of this Order, Respondents shall retain an Independent Financial Monitor (“IFM”), to verify Respondents’ compliance with all terms of this Order that bear, in any respect, on the financial condition of the Nursing Homes and the requirements under this Order, including but not limited to: a) Expenditures required or prohibited pursuant to this Order; b) Compliance with this Order; and c) Sufficiency of expenditures to implement the recommendations of the IHM under this Order. 8 16) The Court shall select the IFM from one of the following potential candidates provided by MFCU: • Elyse Ruzow, Ruzow & Associates • Robert H. Silbering (T&M, USA, LLC) 17) The IFM will have the powers described herein until and unless this Order is superseded by a subsequent Order of this Court. The IFM may retain additional personnel, including but not limited to independent consultants, if needed to help meet the IFM’s obligations under this Order. The IFM may confer and correspond with Petitioner and/or Respondents, including the Nursing Homes, individually or together. The IFM and Respondents shall not negotiate or enter into a financial relationship, other than the monitoring engagement required by this Order, and the IFM shall refrain from recruiting and/or hiring any employee of the Nursing Homes or the other Respondent entities for one year after the expiration of this Order. 18) The IFM is not an agent of MFCU. 19) Nothing herein shall be construed as deeming the IFM or MFCU to be an Operator of the Nursing Homes. 20) Scope of Monitorship. The IFM shall be responsible for reviewing the financial condition of the Nursing Homes, and BIS Funding LLC, Skilled Staffing LLC, and CFSC Downstate LLC (“Related Party Vendors”) to ensure that the Nursing Homes maintain sufficient funds to: a) fund the Operations of the Nursing Homes, in accordance with all applicable laws, rules, and regulations, b) implement the recommendations of the IHM, and c) ensure compliance with this Order, including but not limited to, the prohibitions against the Nursing Homes transferring assets, directly or indirectly, to the Related Party Vendors. 9 21) The IFM shall have the power, in its discretion, to issue recommendations to the Nursing Homes and the Related Party Vendors to effectuate the terms of this Order, included but not limited to: a) Preventing, blocking, canceling, reversing or modifying the terms of any financial transaction that would cause the Nursing Homes and/or Related Party Vendors to violate this Order; and b) Instructing or directing financial transactions necessary to effectuate the terms of this Order. 22) On-Site Visits. In furtherance of the responsibilities described above, the IFM shall visit each of the Nursing Homes, as needed and within the IFM’s discretion. 23) Access. The IFM shall have: a) Unconditional access to view all information concerning the Nursing Homes’ finances, including, but not limited to, direct electronic access to the bank accounts of the Related Party Vendors and the Nursing Homes. b) Unconditional access to, and/or copies of (in the format requested by the IFM), the books and records of the Nursing Homes and the Related Party Vendors, as well as unconditional access to any accountant or accounting firm for the Nursing Homes and the Related Party Vendors, which, in the IFM’s sole discretion, is necessary to carry out the IFM’s responsibilities. 24) Obligations for the Nursing Homes and Related Party Vendors. The Nursing Homes and Related Party Vendors shall fully and promptly cooperate with the IFM and shall ensure that the Nursing Homes’ and Related Party Vendors’ officers, employees, and agents fully and promptly cooperate with the IFM. 10 25) IFM Proposed Corrective Action. To effectuate the IFM’s responsibilities, as set forth herein, the IFM shall make recommendations to the Nursing Homes and Related Party Vendors. All such recommendations shall be made in writing and submitted by email to the Administrator of the facility to which the recommendation relates, with a copy to Respondents and Petitioner, in the manner described in ¶ 32. The Nursing Homes and Related Party Vendors shall implement all recommendations made by the IFM within five (5) business days, unless they produce documentation that good cause exists to decline to follow the IFM’s recommendations within the five (5) days. If any of the Nursing Homes refuses to implement any such recommendation (either by objecting or taking no action), the IFM shall notify Petitioner by email and send any documented explanation, within three (3) business days of such refusal. Petitioner shall review the documented explanation and, in writing, either (a) apprise the IFM and the Nursing Home/Related Party Vendor that Petitioner accepts the Nursing Home’s/Related Party Vendor’s explanation and rejects the IFM’s recommendation; or (b) that the Nursing Home/Related Party Vendor must implement the recommendation. 26) It shall be a violation of this order: a) If any of the Nursing Homes or Related Party Vendors fails to implement any recommendation of the IFM within five (5) business days of the IFM issuing it (or other reasonable period of time set by the IFM); or b) If any of the Nursing Homes or Related Party Vendors fails to implement any recommendation within five (5) business days of MFCU’s determination to affirm an IFM recommendation (as described in ¶ 25(b)). 27) Funding of IFM’s Expenses, including implementation of Recommendations. Respondents shall: 11 a) Pay for the cost of, and the expenses incurred by, the IFM in connection with this Order, including but not limited to labor costs (direct and indirect); consultant and subcontractor costs; materials costs (direct and indirect); and other direct costs (travel, other miscellaneous); and b) Pay the IFM’s invoices within 15 days of submission to the Nursing Homes and/or Related Party Vendors by the IFM. Respondents’ failure to pay the IHM within 15 days shall be considered a violation of this Order. 28) The IFM shall charge a reasonable amount for its fees and expenses, and shall submit monthly invoices to Respondents, by email, as described in ¶ 32(b), with a reasonable level of detail reflecting all key category costs billed. 29) At no point shall the payment of the IFM be drawn or otherwise derived from the funds or operating accounts of the Nursing Homes. 30) Respondents shall not fund the expenses set forth herein with Medicaid payments made to the Nursing Homes or Medicaid payments made to any other nursing home individually or partly owned by any of the Respondents. 31) Violations of this Order. In the event that Respondents violate this Order, the IFM shall inform the Court of such violation in writing, with a copy to MFCU, within five (5) business days of the violation. Upon a determination by the Court that Respondents have violated this Order, the Court shall impose a fine of Five Thousand dollars ($5,000.00) per day shall until the violation is remedied (including payment in full of any outstanding or accrued fines), as determined by the Court; or any such other relief that this Court deems proper. 12 Notices 32) Any notices pursuant to this Order shall be in writing and shall be sent by email, as follows: a) TO PETITIONER: MFCUNotices@ag.ny.gov; b) TO RESPONDENTS: ___________________; c) TO THE ADMINISTRATORS: i) Beth Abraham Center: _____________________; ii) Buffalo Center: _________________________; iii) Holliswood Center: _______________________; and iv) Martine Center: ___________________________. END OF EXHIBIT A 13