The property owner of West Suburban Medical Center has filed a lawsuit in the Cook County court against Resilience Healthcare alleging millions in unpaid rent and prolonged mismanagement of the hospital.
On April 22, Rathnaker Reddy Patlola — the landlord of West Suburban through Ramco Holdings and a minority owner of Resilience Healthcare — filed the suit for seven counts of breach of contract, seeking to recover over $24 million in unpaid rent and fees from Resilience-owned West Suburban, Weiss Memorial Hospital in Chicago’s Uptown neighborhood and other medical office buildings. The lawsuit also calls for a court-appointed receiver to take over hospital operations from Manoj Prasad, CEO of Resilience Healthcare, and alleges misappropriation of a $10 million state loan.
“West Suburban Medical Center has been a vital healthcare resource for thousands of residents, including many who rely on safety net services,” Patlola said in a statement. “We are taking this action to ensure that a qualified and responsible operator can be put in place as quickly as possible to restore care and protect the health and well-being of the community.”
According to Ramco’s suit, the same day that Resilience received a $10 million loan for Weiss Memorial Hospital on May 2, 2025, the money was moved from Weiss’ lockbox account to the hospital’s operating account, then transferred to Westlaw Management Group — a company owned solely by Prasad. Ramco claims the state money was not used for hospital operations, which led to Weiss closing that August after its Medicare agreement was terminated by federal officials.
Ramco alleges that West Suburban’s closure is the product of financial and operational mismanagement by Prasad and that he lacks a viable plan to reopen the hospital.
“While Dr. Prasad claims that he has a plan in place for reopening West Suburban Medical Center, his track record paints a bleaker picture,” Ramco said in Wednesday’s filing. “Weiss Memorial Hospital was also a safety-net hospital which closed due to Dr. Prasad’s mismanagement and believed misappropriation of millions of dollars of funds provided as a loan by the state of Illinois to Weiss.”
Ramco’s suit argued that Prasad’s alleged misappropriation of state funds led to major facilities issues at the hospitals, including failing HVAC systems and X-ray machines creating unsafe conditions for patients.
This week’s filing is just the latest piece of fallout to hit the local court system since West Suburban abruptly closed last month. Last week, Prasad and Resilience filed a lawsuit against Ramco challenging the eviction notices placed on West Sub’s River Forestcampus and at Weiss on April 9.
In that filing, Prasad argued he had a deal with Ramco that set rent for the hospital properties at just $1 per year until the hospitals turned a profit. The filing accused Ramco and Patlola of sabotaging the hospitals.
“This matter arises from the latest escalation in a series of improper acts perpetrated by Ramco and its owner, Rathnakar Reddy Patlola, to sabotage the operations of Weiss Memorial and West Suburban and substitute in new management for financial gain,” attorneys wrote in Prasad’s legal complaint. “The relationship between Dr. Prasad and Patlola deteriorated over time after Dr. Prasad requested, on Resilience Healthcare’s behalf, that Ramco comply with its obligations to perform repairs and fix serious issues at both hospitals, including the hospitals heating and cooling systems and elevators. Patlola, on behalf of Ramco, repeatedly refused, claiming that he would not pay for repairs until he received more revenue from the hospitals—even though the lease agreement he signed on Ramco’s behalf expressly provides that additional rent would not be coming until the hospitals were profitable.”
Ramco’s filing this week argued that the documents that Prasad included to support that claim were fraudulent.
“The document that defendants rely upon contains several irregularities,” Ramco argued. “It appears defendants are using this dubious document in a blatant attempt to shirk Defendants’ obligations’ under their respective leases.”
Wednesday’s lawsuit asked for a qualified receiver to be appointed to take over operations and manage the closed hospitals. Ramco argued that Resilience had consented to the appointment of a new receiver in the event of a default on rent.
Ramco’s chosen receiver will likely be Insight Chicago, a Michigan-based non-profit health system that manages the former Mercy Hospital in Chicago’s Bronzeville neighborhood. Patlola wrote to State Rep. La Shawn Ford last week following Prasad’s suit saying that Prasad’s claims were fraudulent and that a deal for Insight to take over West Sub was imminent, Wednesday Journal has learned.
“He sued us today, presenting a fraudulent document that claims I signed a lease with him for $1 rent per year,” he wrote to Ford. “Despite this, we are moving forward with filing for emergency receivership this Thursday. To succeed, we urgently need letters of support from community leaders emphasizing the hospital’s necessity, as well as letters from furloughed employees expressing their desire to return to work. It will be great if we can get letters from elected Representatives for the benefit of their constituents (ie patients) that will be golden. This is an uphill battle, but I am giving this my last shot to save the hospital and bring our staff back. Insight Hospital is ready to take over and reopen the facility ASAP, but we need significant community support to convince the judge.”
Hospital leadership announced the closure of West Sub last month citing a prolonged failure in the hospital’s billing system that resulted in as much as 90% of its work going unbilled. Resilience has since hired dozens of people to try and collect payment for the 120,000 outstanding claims related to West Sub services, the company announced earlier this week.
In the months leading up to the closure, Wednesday Journal reported on a variety of financial issues at West Sub and at Resilience Healthcare including unpaid vendors, the loss of the hospital’s once-revered doctor residency program and the millions owed in state and local taxes.