By Stephen W. Sather
Barron & Newburger, P.C.
I recently wrote about a case that could not escape Delaware's gravity here. However, a new decision from Judge Laurie Selber Silverstein shows that it is possible to gain a transfer of venue out of The First State. Case No. 17-10201, In re LMCHH PCP, LLC (Bankr D. Del).
The case involved two jointly administered entities. Louisiana Medical Center and Heart Hospital, LLC operated a hospital in Lacombe, Louisiana near New Orleans. LMCHH PCP, LLC was the entity formed as a Physicians Group. The hospital saw a surge in business after it was spared by the surging waters of Hurricane Katrina. Unfortunately, when the hospital underwent a $40 million expansion, it could not cover its cost of operations. When it could not locate a buyer outside of bankruptcy, it chose to file chapter 11.
The Debtors filed their petitions on January 31, 2017. Two days later, on February 2, 2017, McKesson Corporation filed a Motion to Transfer Venue. The Motion stated that
This Court should transfer venue to the Louisiana Court because it is in the best interests of patients and the other stakeholders to have the local bankruptcy court handle the wind down, closure and potential sale/liquidation of this single hospital located in Lacombe, Louisiana. In single-location hospital and healthcare bankruptcy cases, the local bankruptcy court always is the best venue to oversee the myriad of issues that arise in these types of healthcare bankruptcy cases.