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Kentucky Court Holds Nursing Home Arbitration Agreement is Enforceable

file000848537366-2 morguefile username claritaThe U.S. District Court for the Western District of Kentucky has stated a pre-dispute nursing home arbitration agreement is enforceable in a wrongful death lawsuit.  The case involving the arbitration agreement is Life Care Centers of America, Inc. v. Estate of Neblett. In this instance, the patient signed an arbitration agreement before entering a Kentucky nursing and rehabilitation center in November 2013. While residing at the skilled care facility, the woman was allegedly fatally injured due to neglect and inadequate care. Five days after entering the nursing home, the woman died. About six months later, the woman’s spouse filed a wrongful death lawsuit against the long term care facility, its parent company, and its administrator in McCracken County, Kentucky.

The Tennessee-based parent company of the nursing home asked the U.S. District Court for the Western District of Kentucky to enjoin the state court action and compel the dispute to arbitration. The decedent’s husband then filed a motion to dismiss the federal action for a number of reasons, including lack of subject matter jurisdiction. The man also argued that the parties’ agreement to arbitrate was invalid and unenforceable.

After holding that subject matter jurisdiction was proper based on diversity of citizenship, the federal court turned to the man’s request that the court abstain from exercising jurisdiction. Although a substantially similar parallel action was ongoing in state court, the U.S. District Court for the Western District of Kentucky stated that the eight factors a federal court must consider when determining whether to refuse jurisdiction largely supported the exercise of federal jurisdiction in the legal dispute.

Next, the court addressed the man’s claim that the arbitration agreement his wife signed when she entered the nursing home was unenforceable because it did not involve interstate commerce, the agreement was unconscionable, and the arbitral provision was void as against public policy. According to the federal court, the United States Supreme Court has held that “interstate commerce” should be interpreted broadly. In addition, the court said relevant case law states nursing home care necessarily involves interstate commerce because many of the supplies involved originate in other states.

The federal court then examined whether the parties’ arbitration agreement was unconscionable. According to the Western District, the written agreement was not procedurally unconscionable. In addition, the court held that the Federal Arbitration Act (“FAA”) evidences a federal policy favoring arbitration. Because of this, the man’s argument that arbitration would provide an inadequate forum in which to present his deceased wife’s claims against the facility was without merit. Finally, the federal court dismissed the man’s claim that the Federal Arbitration Act does not apply to a pre-dispute agreement to arbitrate a claim against a nursing home.

Since federal subject matter jurisdiction existed and the parties’ arbitration agreement was enforceable, the U.S. District for the Western District of Kentucky denied the man’s motion to dismiss the federal court proceedings.

If you or someone you love suffered abuse or neglect at a Kentucky nursing home, you should speak with a knowledgeable personal injury attorney as soon as possible. To discuss the facts of your case, call English, Lucas, Priest & Owsley, LLP at (270) 781-6500 or contact us online.

Additional Resources:

Life Care Centers of America, Inc. v. Estate of Neblett, Dist. Court, WD Kentucky 2014

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Woman Ordered to Arbitrate Abuse Claim Against Fayette County Nursing Home: Brookdale Senior Living Inc. v. Hibbard, November 4, 2014, Kentucky Personal Injury Attorneys Blog

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Photo Credit: clarita, MorgueFile