State Investigation: Does Brius Nursing Home Closure Violate Lease Signed by Brius CEO?

A state agency is investigating whether Brius’ voluntary closure of three Humboldt County nursing homes violates a lease signed by Shlomo Rechnitz, Brius’ multi-billionaire owner.

On October 28, the National Union of Healthcare Workers (NUHW) asked a state agency to investigate Brius’ apparent violations of a lease agreement that prohibits Brius from closing three Humboldt County nursing homes. The ten-year lease agreement, signed by Rechnitz in 2011, also prohibits Brius from removing or transferring residents. The complete lease agreement is available below.

On November 2, the Eureka Times-Standard reported that the California Department of Public Health is investigating NUHW’s complaint made in a letter delivered to the agency on October 28. A copy of the letter, which includes 30 pages of lease records and other documents, is available below.

Download (PDF, NUHW Letter to CDPH – Brius Humboldt Lease Violations)

In its letter, NUHW points to other apparent violations committed by Brius. According to the lease, Rechnitz committed to investing at least $3 million over a several-year period to upgrade the facilities. State construction records, however, indicate that Rechnitz failed to do so.

Rechnitz also appears to have violated other provisions of the lease, including one that requires him to keep the facilities “in good working order and repair.” At Brius’ Pacific Rehabilitation & Wellness Center in Eureka, a portion of the facility is at risk of collapse, according to visitors and family members.

Pacific Rehabilitation & Wellness Center's roof
The roof at Pacific Rehabilitation & Wellness Center in Eureka

Photos published by the Eureka Times-Standard show “visible damage” on the outside of the nursing home as well as 4-by-4’s used to hold up a portion of the roof.

In addition, the nursing home apparently doesn’t have a working heating system. In 2013, Rechnitz received approval from the state to install a new heating system but state records indicate that the project is only 10% complete.

On October 13, Jeff Graham – whose mother is a resident at Pacific Rehabilitation & Wellness Center – told KMUD Radio News that Brius officials were trying to move his mom, who is partially paralyzed, to the back of the facility because there is no heat in the front half of the nursing home. KMUD Radio News interviewed Graham outside the nursing home, where he was participating in a protest against Brius’ effort to evict his mom and approximately 200 other seniors, and transfer them to facilities hundreds of miles from their families.

Lease Agreement between Shlomo Rechnitz and Skilled Healthcare Group:

Download (PDF, Lease Agreement)