Steward Health Care CEO, Ralph de la Torre, is defying a subpoena to appear before a U.S. Senate committee investigating the company’s bankruptcy, as per his lawyers on Wednesday. The lawyers argued that de la Torre must maintain silence due to ongoing hospital restructuring and settlement negotiations, following a court order prohibiting him from discussing matters during mediation. Steward, based in Dallas and operating approximately 30 hospitals nationwide, including over a half-dozen in Massachusetts, filed for bankruptcy earlier in the year. Despite efforts to sell its Massachusetts hospitals, bids for Carney Hospital and Nashoba Valley Medical Center failed, leading to their closure last weekend. The federal bankruptcy court has approved the sale of Steward’s other hospitals in Massachusetts.
De la Torre’s lawyers accused the Senate committee of attempting to turn the hearing into a “pseudo-criminal proceeding” aimed at convicting de la Torre in public opinion rather than gathering facts on Steward’s bankruptcy proceedings. They contended that the committee is overstepping its role by making presumptions of criminal misconduct. While de la Torre did not dismiss the possibility of testifying later, Senate Health Committee Chair Bernie Sanders asserted that the committee would not tolerate the delay and would push for de la Torre to provide answers regarding Steward Health Care’s alleged mismanagement.
Massachusetts Senators Edward Markey and Elizabeth Warren criticized de la Torre’s refusal to testify before the committee, denouncing it as outrageous. The committee’s options include pursuing criminal contempt, leading to a trial and potential incarceration, or civil contempt, which could result in fines until de la Torre appears. Both outcomes necessitate a Senate vote, with Markey and Warren emphasizing that de la Torre must be held accountable and provide answers to Congress. They accused de la Torre of benefiting financially from the distress of hospitals under his management, emphasizing that he led luxurious lifestyles while allegedly undermining Steward hospitals.
De la Torre had previously declined to testify at a Boston hearing chaired by Markey earlier in the year. Sanders pointed out that de la Torre accumulated immense wealth by burdening hospitals in multiple states with substantial debt and profiting from property sales to real estate investors who imposed exorbitant rents.
