Minnesotans looking to hold senior homes accountable for abuse and neglect won a legal victory after a district judge threw out a forced arbitration clause that would have prohibited a family from suing in court.

In a recent decision, Anoka County Judge Sean Gibbs upheld the right of a family to sue an assisted-living facility over the sudden death of an 89-year-old man, Gerald Seeger, who died of complications related to a common hernia. The facility, Lighthouse of Columbia Heights, had argued in court that, despite the man’s death, the family had forfeited the right to a jury trial by signing an arbitration agreement at the time of his admission.

Legal experts say the decision is among the first of its kind in Minnesota, and could embolden more residents to challenge densely worded clauses that require residents to settle disputes through a secretive arbitration process rather than through a public court proceeding.

“This is not just a victory for me, but it’s a victory for everyone who has ever felt silenced by these agreements,” said Joan Maurer, Seeger’s daughter, who filed a wrongful-death lawsuit against Lighthouse after state health investigators found the facility failed to provide timely medical care. “This shows that they can’t just shove me into a room with an arbitrator, where one person decides the value of my father’s life in secret.”

In his ruling, the judge stopped short of making a broad pronouncement against arbitration provisions in senior home contracts, saying the terms of the contract were reasonable, while rejecting it for procedural reasons.

“The judge’s determination ... generally supports Lighthouse of Columbia Heights’ view that arbitration benefits both parties in dispute resolution by avoiding costly and lengthy court cases,” said Doug Anderson, a spokesman for New Perspective Senior Living, the Eden Prairie-based parent of Lighthouse.

Even so, the decision comes as growing numbers of senior home residents and their relatives challenge mandatory arbitration clauses, which are frequently included in the dense paperwork people sign upon admission to long-term care facilities. The clauses require people to forfeit their right to a court hearing and, instead, lock residents into a private process for resolving claims. Even in cases of neglect and death, senior homes use the clauses to prevent residents and their families from pursuing lawsuits.

Late last year, the federal Centers for Medicare and Medicaid Services (CMS) issued a breakthrough rule barring the 15,000 long-term care facilities that receive Medicare and Medicaid funds from requiring that residents enter into arbitration before a dispute arises, known as “pre-dispute” arbitration. While the CMS rule has been blocked in court, the government’s case has emboldened more consumer attorneys to challenge such clauses, particularly when they are poorly explained or families feel pressured to sign them.

“There is a tremendous amount of pressure on families, and often times they don’t have adequate time to really understand what’s going on before signing,” said Eric Carlson, directing attorney of Justice in Aging, a legal advocacy group in Washington, D.C.

Seeger, a florist who was born and raised in St. Paul, died in September 2015 of complications from an incarcerated, or strangulated, hernia. Maurer has photographs from the day of his death, showing her father’s stomach bulging out like a balloon. State investigators cited Lighthouse for neglect after finding that the facility failed to promptly report changes in Seeger’s medical condition after he complained of stomach pain and was vomiting. After Maurer filed a wrongful-death lawsuit, attorneys for Lighthouse moved to compel arbitration rather than go to trial.

In his decision, Gibbs found that the arbitration contract used by Lighthouse was “procedurally unconscionable” and not enforceable because the Seeger family had been subjected to a “rushed, pressured process” upon admission. The family was told that the agreement had to be signed that day or the apartment — the only apartment in the facility that accepted Medicaid benefits under the state Elderly Waiver program — would no longer be available.

The family was not given time to have the agreement, which had conflicting provisions, reviewed by a lawyer, the judge said in his decision.

“I think this sets the stage ... for greater scrutiny of what is being marketed to residents,” said Suzanne Scheller, an attorney in Champlin who represents the Seegers in the wrongful death case. “This reflects the court’s willingness to examine what was written, what was said, and what was promised at the time of admission.”

 

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