Rogue Valley Manor residents will sue PRS

Attorney says Manor’s corporate parent would not budge on several issues

A committee of Rogue Valley Manor residents has served notice it will file a class-action suit in Jackson County Circuit Court asking for $30 million from Pacific Retirement Services because of what it claims are excessive management charges by PRS.

Residents of the retirement community have been at odds with the Manor's corporate parent for months, saying that PRS and its board have exceeded their authority and removed virtually all decision-making power from the Rogue Valley Manor's own board.

Manor residents, who overwhelmingly endorsed the legal action last week, rapidly raised a legal war chest of hundreds of thousands of dollars late last summer.

In a 50-page draft complaint, residents seek removal of PRS control over the Manor; rescission of an Aug. 24 bylaws amendment that reduced the Rogue Valley Manor board from nine to three members; and reinstatement of dismissed Manor board members or appointment of an independent board that cannot be appointed or removed by PRS.

They are also asking the court to give the Rogue Valley Manor board the right to select the community's executive director and for the return of Kevin McLoughlin to that role. Further, the residents request an accounting of "excessive management and related fees collected by PRS" and action to prevent PRS from transferring or dissipating the Manor's assets.

Last week during an hour-plus session with several hundred Manor residents, Portland attorney David Markowitz said the concerns over excessive fees were justified.

"The prior board's investigation and the investigation by my law office and our forensic accountant all demonstrate that there are significant profits being made by PRS on its management fees for its governance over the Rogue Valley Manor," Markowitz said in a video of the meeting that was made available to the Mail Tribune. "We have alleged ... it is an amount in excess of $1 million a year that has continued for years and years and years. Some years, in excess of $1.5 million of profit that has been used by PRS not for the benefit of Rogue Valley Manor but in order to fund its ventures elsewhere, including its losses that it has sustained in its for-profit failed activities or failing activities elsewhere."

PRS Chief Operating Officer Mike Morris, who was in attendance for at least part of the meeting, told residents PRS intended to present its side of the matter within two weeks.

"There will be additional information beyond what is discussed here," Morris said. "We look forward to very open discussion and being able to hear both sides."

— Greg Stiles

Read more in the Mail Tribune on Wednesday.


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