Court Error – Bankruptcy

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7^th Circuit Court of Appeals

Case Name: Home Care Providers, Inc, et al., v. Kelly Hemmelgarn, et al.; Nightingale Home Healthcare, Inc. v. United States of America, et al.

Case No.: 16-2054; 16-3668; 16-3669

Officials: BAUER, FLAUM, and KANNE, Circuit Judges.

Focus: Court Error – Bankruptcy

This consolidated appeal was prompted by the federal government’s termination of Nightingale Home Healthcare, Inc.’s Medicare provider agreement. Nightingale sought and received a preliminary injunction from the bankruptcy court that prevented the government from terminating Nightingale’s agreement. On appeal, the district court concluded that the bankruptcy court had lacked jurisdiction to issue an injunction and reversed the order. We conclude, however, that the issue of whether the bankruptcy court properly granted the injunction was moot, as the bankruptcy court had dissolved the underlying injunction prior to the district court’s ruling. Separately, Home Care Providers, Inc., Nightingale’s sole shareholder, and its owner, Dr. Dev A. Brar, filed a civil action in the district court, alleging that certain Indiana state surveyors had committed various constitutional violations leading up to Nightingale’s Medicare termination. The district court dismissed those claims with prejudice. We conclude Nightingale’s and Dr. Brar’s constitutional claims were also jurisdictionally barred, pursuant to 42 U.S.C. § 405(g), and vacate and remand with instructions to dismiss without prejudice.

Vacated and remanded

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.