Prime Healthcare, which backed out of its proposed bid to buy six Daughters of Charity Health System hospitals, including two in the Southland, after disagreeing with conditions imposed on the sale sued the state’s attorney general Monday for allegedly abusing her constitutional powers.
In the lawsuit filed in federal court in Los Angeles, Prime Healthcare said its allegations against Attorney General Kamala Harris point to “a sweeping indictment of governmental overreach and the California regulatory system and the unlawful influence of the Service Employees International Union United Healthcare Workers West.”
The complaint alleges Harris “sold” her political office to the union by conditioning her regulatory approval of the hospital purchases on Prime’s agreement to accept unionization demands.
Harris’ office contends Prime backed out of the sale in March because it had no intention of maintaining needed health-care services at the six hospitals, including St. Francis Medical Center in Lynwood and St. Vincent Medical Center near downtown Los Angeles, if the deal went through.
“Prime chose to walk away from the Daughters transaction months after publicly stating that it had no issue with the 10-year conditions and did not intend to close any of the hospitals or end essential services,” Harris spokeswoman Kristin Ford said this afternoon.
“After an in-depth and independent review, 44 hours of public meetings and 14,000 comments from members of the public, Attorney General Harris set conditions designed to ensure that those who relied upon Daughters of Charity health services would continue to receive the care they need,” she said. “Prime’s decision to walk away, and this lawsuit, reaffirms the concerns voiced at multiple community meetings, that Prime never intended to prioritize the continuity of vital health services.”
The proposed sale had been the subject of multiple public hearings that featured opponents claiming Prime would cut services at the nonprofit hospitals to boost the bottom line, while proponents said the hospitals faced possible closure if the deal was not approved.
Harris said at the time that Prime had stated publicly earlier that it had no issue with the conditions, which she said she imposed to “ensure the continuity of these health care services.”
The lawsuit names Harris as the defendant and seeks immediate injunctive relief on numerous constitutional grounds, including alleged violations under the due process and equal protection clauses of the U.S. and California constitutions.
“Attorney General Harris abused her constitutional authority by placing her need for political financial support over the health-care needs of the people,” said Troy Schell, general counsel for Prime Healthcare. “By imposing restrictive conditions on Prime and only Prime, she forced the company to withdraw its offer for the DCHS hospitals, jeopardizing health care in these underserved communities.”
The 62-page complaint accuses Harris of being a “puppet” of the union, which has waged a “years-long corporate campaign against Prime in order to force the company to allow the SEIU-UHW to unionize all its hospitals.”
The lawsuit also alleges that the union promised to support Harris, who is seeking the U.S. Senate seat of retiring Sen. Barbara Boxer, using up to $25 million in political contributions through an independent expenditure fund if she denied the Daughters sale sale or imposed deal-killing conditions.