Shares of Foothill Ranch-based nursing home operator Skilled Healthcare Group Inc. collapsed Wednesday after a Northern California jury decided the company should pay $671 million in damages for providing inadequate staffing at California facilities.
Skilled’s shares closed down 75% to a market value of about $55 million.
The company, which operates 100 nursing homes in California and other states, said it intends to “vigorously pursue various post-trial motions, as well as an appeal, if necessary.”
The jury award is potentially crippling for Skilled, which has yearly sales of about $760 million.
The company said its insurance won’t cover the potential damages since its professional liability coverage is exhausted for the policy year covering the case.
Skilled could be required to post a bond for 150% of the final judgment amount, according to the company.
A jury in Humboldt County awarded $613 million in statutory damages and $58 million in damages for restitution in a class action lawsuit against Skilled.
The jury has yet to hear the punitive damages phase of the trial.
The litigation covers 2003 to 2009 and contends Skilled didn’t provide adequate staffing for patients at several California facilities.
State law requires nursing homes maintain 3.2 nursing hours per-patient, per-day.
Skilled Healthcare owns 22 facilities in the state.
