Counsel for the business-partners-turned-legal-foes at the heart of the West Suburban Medical Center were in court again Monday morning as a third party continues its review of contested financial records.
The hearing comes after Resilience Healthcare CEO Manoj Prasad and the hospital’s landlord, Rathnakar Reddy Patlola, filed lawsuits against each other last month, with Patlola seeking a judge’s order that could start the process of reopening West Suburban under new management.
Cook County Judge Patrick Stanton heard new allegations of extensive personal use on company credit cards by each party in a brief status hearing in the case Monday morning at the Richard J. Daley Center. The parties agreed last week to have recently retired Judge Patrick Sherlock oversee years of records related to several bank accounts central to the most-serious allegations of financial wrongdoing that Patlola has made against Prasad.
Judge Stanton said that the agreement likely expedited the proceedings by several months.
“This normally would take three months, but we got this done in one week,” Stanton said.
The case will return to court on Wednesday, when Judge Stanton plans to set a final hearing date for the case.
Neither of the business partners was present in the courtroom Monday, with Prasad attending the hearing via Zoom.
At the May 18 status hearing, the parties also disputed the status of a $10 million loan Resilience received last May that was reportedly transferred to Westlaw Management Group — a bank account Patlola alleges only Prasad had access to — instead of used for hospital operations. Prasad’s lawyer said the money has been accounted for.
“We vehemently deny that,” Patlola’s lawyer said, adding that he’s still looking for more information and documentation of where the $10 million went.
In April, Patlola filed a suit against Prasad for seven counts of breach of contract, seeking to recover over $24 million in unpaid rent and fees for Resilience-owned buildings. Prasad’s suit claims that Patlola tried to illegally evict him last month.
On Tuesday at the Daley Center, there will be a hearing between Patlola and Pipeline Health, the former owner of West Suburban and its sister hospital, Weiss Memorial Hospital in Chicago’s Uptown neighborhood. The lawsuit stems from millions of dollars disputed in the 2022 sale of the hospitals.
West Suburban Medical Center closed its doors March 27, citing a year-long failure in the hospital’s electronic medical record billing system that resulted in as much as 90% of its work going unbilled. About two weeks later, some patient care services resumed at West Sub’s Oak Park campus, according to Prasad.