Shares of Foothill Ranch nursing home company Skilled Healthcare Inc. rose Monday after it filed a motion for a mistrial and new trial in a potentially crippling lawsuit it lost in July.
Shares of Skilled shot up as high as 36% in Monday trading before closing up 24% with a market value of about $116 million.
Last month, a jury found Skilled liable for $677 million in damages for alleged mismanagement of 22 California nursing facilities.
The company is seeking a mistrial, contending a juror lied on a sworn questionnaire about connections to one of the plaintiffs and to one of Skilled’s defendant facilities.
After the verdict, Skilled reached an agreement with the plaintiffs to stay all proceedings and pursue settlement talks that were set to last until Monday, when both sides are due in court.
Settlement talks are ongoing, according to Skilled.
Analyst Arthur Henderson of Stamford, Conn.-based Jeffries & Co. said in a report that “we could easily see the Superior Court of California declare a mistrial here. Given that possibility, we suspect that the plaintiffs may be willing to negotiate for a more reasonable settlement.”
