Emergency Petition Seeks to Expedite Conservatorship for CEO of Nursing Home Giant Life Care Centers

By Amy Stulick

An emergency petition on Tuesday was filed to expedite the conservatorship action brought by the son of Life Care Centers of America CEO Forrest Preston, as other executive members cited year-end obligations.

Preston’s son, Aubrey B. Preston, should be appointed as his conservator on an emergency basis, executives said, due to the critical and time-sensitive needs of Tennessee-based nursing home operator Life Care and its affiliates. Forrest is incapable of attending to his duties as CEO in his disabled status, the executives allege in the court filings.

The son is requesting limited powers necessary to protect his father’s health, safety and welfare. And, in consultation with Life Care President Todd Fletcher and CFO Steve Ziegler, the younger Preston is seeking to make all decisions for Life Care and its affiliates that his father made in his leadership roles.

“[Forrest] is often the sole decision maker for essential business decisions or sole authorized signatory for essential documents,” Ziegler said in the court filing.

A new court date of Nov. 12 was set to hear the emergency request, while a hearing on the original petition was scheduled for mid-January. The action seeks a 60-day appointment in line with the maximum under Tennessee law until the January hearing, according to a report from the Chattanooga Times Free Press.

Fletcher said that despite Forrest’s current roles with Life Care and its affiliates, he neglected his responsibilities by often being absent for weeks if not months on end.

“Forrest’s extended absences have occurred even when pivotal action items were required of him, including [failure] to timely execute loan documents that almost caused the default of an over $100,000,000 loan on one occasion,” Fletcher claimed in court documents.

Personal observations by Ziegler and Fletcher indicate that Forrest Preston is mentally disabled and can no longer understand basic business issues. The executives don’t believe he has the capacity to understand and execute legal documents on behalf of Life Care and its affiliates, according to court documents.

Ziegler and Fletcher said in the court documents that they believe Forrest no longer comprehends even some of the more basic aspects of Life Care and its affiliate operations.

“He, in fact, regularly exhibits confusion about routine matters in his daily life that are far less complex than the business issues he contends with at Life Care and its affiliates,” said Ziegler.

Significant business decisions on the immediate horizon for Life Care include loan renewal documents and vote equity shares to guide the businesses’ direction, court documents show.

Ziegler pointed to year-end tasks that need to be completed. The team can’t wait for January to take action, he said.

Aubrey noted that his father may be a potential flight risk as Forrest’s wife, Kim Nguyen Preston, asked an employee of the nursing home company to begin the process of renewing a passport for Forrest, according to court documents.

Life Care’s executive team is concerned that Nguyen Preston may terminate key employees of Life Care in retaliation as well.

Court filings allege the wife and her siblings also engaged in conspiracy and civilly aided one another in misappropriating Forrest’s assets, citing violations of the Tennessee Adult Protection Act. The filing also claims that since marrying in 2018, Nguyen Preston has progressively isolated Forrest from his family and friends.

The complaint suggests that instead of protecting him, Nguyen Preston and her family unlawfully enriched themselves, acquiring significant real estate and cash.

The older Preston is being asked by a county judge to submit to two medical examinations within 10 days amid the conservatorship petition.

Full Article & Source:
Emergency Petition Seeks to Expedite Conservatorship for CEO of Nursing Home Giant Life Care Centers

See Also:
Life Care Centers CEO Faces Conservatorship Bid, Raising Concerns Over Nursing Home Giant’s Future

‘Disabled’ Life Care Centers owner resists medical, competency tests, son applies for emergency conservatorship

by James M. Berklan

Amid fears his third wife is planning to take him out of the country, the billionaire owner of Life Care Centers of America is now the subject of an emergency conservator request from a son who wants some control over his “disabled” 91-year-old father.

The request in a Tennessee court comes less than a week after Aubrey Preston first asked a judge to intervene on behalf of his father, Forrest Preston, whom he claims has been increasingly isolated and abused by his wife and her siblings since their “secret” marriage six years ago.

It followed the discovery that Forrest’s wife, Kim Phuong Nguyen Preston, had entered company headquarters in Cleveland, TN, late at night for no apparent business purpose less than 48 hours after the initial conservatorship request was filed Oct. 29.

Kim also asked Forrest’s personal assistant at the company to help renew his passport and help get her son a passport.

The emergency appeal, which was filed Monday, included sworn affidavits from Life Care’s president and its CFO, who each testified that Forrest has been missing from company work for weeks or months at a time and is “mentally disabled” and unable to make important decisions.

The result has put Forrest’s health, and that of the company, at great risk, they contend in Monday’s Bradley County Chancery Court filing.

Forrest Preston founded Life Care in 1970 and remains its CEO, board chairman and sole owner. His net worth was estimated by Forbes at $1.2 billion last year.

Life Care consists of more than 200 skilled nursing facilities and assisted living communities in 28 states and has more than 30,000 employees.

Pivotal hearing

A hearing has been set for Nov. 12, at which time Aubrey Preston hopes to be named his father’s conservator, or financial overseer, for up to 60 days. That would bridge the time until a mid-January hearing, which has been set to determine whether more permanent conservatorship terms should be put in place.

After last week’s court filing, a judge assigned a legal guardian to help arrange medical testing for Forrest. Through a long-time friend and business associate, however, Forrest refused to submit to the tests, this week’s filing notes.

When a member of the local media reached him by phone Tuesday, Forrest reportedly vowed he was “here to stay.” He also called his wife “a great class lady” and said he would not “beat up” on Aubrey for filing for conservatorship. 

“We’ll work it out,” he added before cutting off further inquiries, according to the Chattanooga Times Free Press.

Janice Seay, the personal assistant to Forrest Preston, said in her affidavit that Kim asked her to help with his passport renewal after Kim said there was interest in returning to her native Vietnam, possibly to purchase real estate. 

Aubrey Preston has accused Kim Preston, along with her brother and sister who live with the couple in Tennessee, of improperly influencing his father to transfer millions of dollars in cash and US real estate to them.

“Forrest is mentally and physically disabled. Without an emergency conservator in place, there will be substantial harm to his health, safety, and welfare as he is vulnerable, including to Kim [and her sister and brother’s] schemes,” wrote attorney Gary R. Patrick in Monday’s filing.

Life Care Centers President Todd Fletcher, who is also a nephew of Forrest Preston, and CFO Steve Ziegler, said via affidavit that Forrest “no longer comprehends even some of the more basic aspects of Life Care and its affiliates’ business operations.” They also described “confusion about routine matters in his daily life.”

“I do not believe that Forrest has the capacity to understand and execute legal documents on behalf of Life Care and its affiliates,” each testified.

Since Kim allegedly has Forrest under her control, each also said they feared that she would “retaliate” against them and other key employees leading to a loss of “essential leadership and crippling operations.”

“Kim’s disruptions of the business of Life Care and its affiliates is devastating to employee morale and operations,” they added.

Also included in the emergency filing was an affidavit from a neighbor of one of Forrest and Kim’s properties, who said it has uncharacteristically gone into disrepair from neglect and has been frequented by vagrants. Upon talking with Forrest about these conditions, the neighbor said he did not appear to understand the conversation — “he simply was not there.”

Attempts to reach Kim and Forrest Preston Wednesday were unsuccessful.

In his emergency conservator request, Aubrey Preston has asked for “limited powers to protect his father’s health, safety, and welfare in the interim.” That would include assuming his father’s decision-making powers as head of the company, in consultation with LCCA President Fletcher and CFO Ziegler. 

He also would acquire control over his father’s passport and, in consultation with the court-appointed legal guardian, would hold sway over any desired expenditures above $25,000. 

Aubrey and his agents also would be able to investigate Forrest’s assets and any transfers made from him or LCCA to Forrest, his wife or her relatives, or anyone else who has received more than $50,000 in value, during the last two calendar years.

Full Article & Source:
‘Disabled’ Life Care Centers owner resists medical, competency tests, son applies for emergency conservatorship

Life Care Centers CEO Faces Conservatorship Bid, Raising Concerns Over Nursing Home Giant’s Future

By Zahida Siddiqi

The CEO and sole owner of Life Care Centers of America, Forrest Preston, is facing a conservatorship bid from his son, with the suit raising questions about the future of one of the nation’s largest nursing home providers.

Preston’s son, Aubrey B. Preston, is seeking a court intervention in the matter, alleging in an Oct. 29 complaint filing that Forrest’s wife, Kim Phuong Nguyen Preston, and her family have abused and financially exploited his father.

The older Preston is being asked by a county judge to submit to two medical examinations within 10 days amid the conservatorship petition.

The filing asserts that Forrest’s disabilities have allowed Nguyen Preston’s family to disrupt Life Care’s operations and potentially threaten its financial stability. Allegations include Nguyen Preston’s involvement in board meetings and her intimidation of employees.

The court documents called attention to maintenance delays at Life Care facilities as well as sale or closure of facilities to generate cash and reduce operational expenses from the pandemic through early 2024. Based in Cleveland, Tennessee, Life Care Centers owns or manages nearly 200 skilled nursing. post-acute and Alzheimer’s centers in 26 states, and employs approximately 40,000 individuals. It is one of the nation’s largest privately-owned nursing home chains, contributing to Preston’s estimated net worth of over $1 billion.

“Life Care is undercapitalized with over a hundred million dollars of deferred maintenance, needed facility improvements, and depreciated equipment in need of replacement,” the court filing states.

In an emailed statement to Skilled Nursing News, Life Care Centers of America President Todd Fletcher said, “Regardless of any legal proceedings, Life Care’s leadership and associates both in Cleveland and around the country remain committed to fulfilling their mission of providing excellent care to the residents in the communities they serve,” adding that “Life Care has no further comment at this time.”

Company representatives also confirmed that Forest Preston, who founded Life Care in 1976, remains the company’s current owner, chairman and CEO.

In describing the older Preston as “mentally and physically disabled,” the court filing states that Life Care’s executive team has managed as best they can, but that their authority is limited.

“Forrest’s disabilities have progressed to the point that his behavior is endangering Life Care’s very existence,” the filing states.

The court filing alleges that he is “unavailable to Life Care executives for weeks and sometimes more than a month when key decisions are needed or his signature on crucial documents is required.”

Chattanooga attorney Gary L. Patrick, representing the son, stated in the complaint that “Aubrey no longer had any choice but to seek this court’s intervention, not just for Life Care’s patients and employees, but most importantly for the safety and well-being of his father.”

The complaint alleges that Preston’s current wife, Nguyen Preston, and her siblings engaged in conspiracy and civilly aided one another in misappropriating Forrest’s assets, citing violations of the Tennessee Adult Protection Act. The filing also claims that since marrying in 2018, Nguyen Preston has progressively isolated Forrest from his family and friends.

The complaint suggests that instead of protecting him, Nguyen Preston and her family unlawfully enriched themselves, acquiring significant real estate and cash.

Full Article & Source:
Life Care Centers CEO Faces Conservatorship Bid, Raising Concerns Over Nursing Home Giant’s Future