The litigation for both cases began in 2002. Senior Housing along with Five Star brought a lawsuit against Marriott International Inc. and Marriott's wholly owned subsidiary Marriott Senior Living Services Inc. to prevent the transfer of the management contracts affecting 31 senior living communities to Sunrise Assisted Living Inc.
Senior Housing owns the 31 senior living communities located in 13 states throughout the country. They were leased to Five Star and managed by Marriott Senior Living Services. Last year, Marriott International announced its intention to sell Marriott Senior Living Services to Sunrise. Senior Housing and Five Star brought a lawsuit in the Massachusetts Superior Court seeking a declaration that Senior Housing and Five Star may terminate the management contracts because of the proposed sale. Marriott and Marriott Senior Living Services moved to dismiss the lawsuit and this past March, Massachusetts court granted the motion to dismiss.
In a second lawsuit in a Maryland court, Senior Housing and Five Star alleged financial mismanagement by Marriott and Marriott Senior Living Services that should permit the companies to terminate the management contracts.
Under the terms of the settlements, Senior Housing, Five Star and Marriott and Senior Living Services have agreed to dismiss all claims and counterclaims asserted in the litigation between all the parties in the Maryland courts and Senior Housing and Five Star have agreed to withdraw their appeals of the final judgment entered against them in the litigation between the parties in the Superior Court in Massachusetts. Also under the terms of the settlement, Marriott has agreed to pay Senior Housing Properties Trust and Five Star each approximately $1.3 million. Senior Housing owns 150 senior living properties located throughout the US.
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