Hospital chain sues CEO blaming him for bankruptcy
The hospital chain alleges that de la Torre and his team of executives defrauded the company of $262 million and wasted a further $1.1 billion on buying up overpriced hospitals in Florida. The complaint alleges that the catastrophic investments were made to fulfil de la Torre's 'personal desire to build a hospital empire,' a reckless move that involved overpaying about $200 million for the properties.
Steward, which is now being run by an independent administrator after filing for bankruptcy in 2024, is attempting to claw back some of the money from its former bosses to help pay off its debts. De la Torre has become the poster boy for corporate greed rot at the center of the struggling healthcare system. 'Through their greed and bad faith misconduct, [these former insiders] operated Steward with the aim of enriching themselves at the expense of the Company, its creditors, and the patients and communities that Steward served,' the complaint states. 'These insiders pilfered Steward's assets for their own material gain, while leaving the Company and its hospitals perpetually undercapitalized and insolvent.'
The most recent filings also claim that de la Torre and other executives paid themselves a $111 million dividend in 2021, despite knowing that Steward was in trouble as early as 2016. De la Torre founded Steward in Boston in 2010, growing it into the country's largest private for-profit hospital chain, the Boston Globe reported.
It rapidly bought up hospitals on a trajectory that became unsustainable, plunging it into dire financial straits. It eventually filed for bankruptcy in May last year while operating 30 hospitals across eight states.
As it moves through the bankruptcy process Steward has closed two hospitals in Massachusetts - Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer - and sold off a further six. Filings later revealed by The Wall Street Journal showed that after de la Torre took over majority ownership of the hospital chain in 2020, he received personal payments of at least $250 million over the next four years.
He went on to use the money to purchase a $7.2million 500-acre ranch in Waxahachie, Texas, and a 190-foot, $40 million yacht. Further to this de la Torre was revealed to own a 11,108-square-foot mansion in Dallas, valued at more than $7 million.
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