Sunrise Senior Living Inc. will face trial on whether it can be held liable for the alleged negligence of its subsidiary.
The U.S. District Court for the District of New Jersey denied summary judgment to Sunrise, which claimed that as the parent company of Sunrise Senior Living Services Inc., it couldn't be held liable for its subsidiary's alleged negligence. Judge Kevin McNulty ruled that evidence of Sunrise's control of its subsidiary was sufficient enough to allow a jury to deliberate the case.
According to New Jersey law, a plaintiff must show that a parent company “dominated” a subsidiary to the point where it “had no separate existence but was merely a conduit for the parent,” the court said. The court also noted that plaintiffs must show that a parent company had “abused the privilege of incorporation by using the subsidiary to perpetrate a fraud or injustice, or otherwise to circumvent the law.”
The case stems from a lawsuit filed against Sunrise, SSLS and the Sunrise-operated Brighton Gardens nursing facility by the son of a deceased resident. Nancy Gimenez-Watson choked to death on her food while living at Brighton Gardens. Her son, David Watson, alleges her death was caused by Brighton's failure to follow protocols regarding choking and evaluating residents' medical conditions.
Sunrise Senior Living did not respond to a request for comment by press time Wednesday.