A judge approved a bankruptcy trustee's recommendation to close Granada Hills (Calif.) Community Hospital within two weeks and also converted the case to Chapter 7 liquidation from Chapter 11 reorganization. The 139-bed hospital filed for bankruptcy in November after the collapse of its accounts receivables financier, National Century Financial Enterprises, Dublin, Ohio. In January, a U.S. Bankruptcy Court judge in Los Angeles appointed Healthcare Resource Specialists, Tampa, Fla., and its principal, James Doulgeris, to manage the hospital. Doulgeris didn't return to the hospital after a July 4 vacation, and a week later federal investigators reported that at least $1.4 million in employee withholdings had not been paid to the Internal Revenue Service, according to the hospital's filings. In an emergency motion, hospital attorneys said the company paid itself $1.4 million in fees in violation of the bankruptcy court's orders. Reached at his Florida home, Doulgeris denied wrongdoing and said he was astounded by the allegations. "I reported everything to the board and absolutely deny I took any money," he said. Michael Lubic of the Los Angeles office of Sonneschein, Nath & Rosenthal, who represents one of the hospital's creditors, said the allegations in this case are extremely unusual. -- by Mark Taylor
Bankruptcy may have sealed Calif. hospital's fate
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