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Quabbin Valley Healthcare on Daniel Shays Highway in Athol. Credit: PAUL FRANZ \/ Staff Photo<\/p>\nATHOL \u2014 The co-founder of the limited liability company that owns two western Massachusetts nursing homes will be forced to compensate lenders $2.1 million after being found liable for fraud, breach of contract and violations of consumer protection law.<\/p>\n
A Middlesex County Superior Court jury determined after an eight-day trial that Joseph Cuzzupoli, who co-founded Blupoint Healthcare, persuaded Bradley Balter and his business, Arrakis Holdings LLC, to extend loans based on numerous fraudulent misrepresentations. Blupoint Healthcare operates Quabbin Valley Healthcare at 821 Daniel Shays Highway in Athol and Pioneer Valley Health & Rehabilitation at 573 Granby Road in South Hadley, now known as South Hadley Rehabilitation and Nursing Center.<\/p>\n
Quabbin Valley Healthcare on Daniel Shays Highway in Athol. Credit: PAUL FRANZ \/ Staff Photo<\/p>\n
\u201cBased on its assessment of the trial evidence, the court concludes that Cuzzupoli\u2019s unfair and deceptive conduct undeniably caused harm to the plaintiffs,\u201d Judge Michael Pineault wrote in his post-trial findings and rulings. \u201cThe court further determines that $2,119,645.41 is an appropriate penalty for the knowing and willful nature of Cuzzupoli\u2019s violation of the statute.\u201d<\/p>\n
Balter and Arrakis Holdings LLC sued Cuzzupoli, seeking declaratory relief and damages for breach of contract, unjust enrichment, fraud and consumer protection law violations in connection with unpaid loans extended to certain nursing homes and a hospice business that Cuzzupoli controlled. Cuzzupoli wanted a declaration from the court that the loans\u2019 interest rates violated state law and he sought damages for what he alleged were the plaintiffs\u2019 own unfair and deceptive acts. However, the jury ruled against Cuzzupoli.<\/p>\n
Balter said in a phone interview that he got connected to Cuzzupoli through a mutual acquaintance. He explained that Cuzzupoli convinced him into loaning money by saying the nursing homes\u2019 nurses would not otherwise get paid.<\/p>\n
Balter said the fallout from this jury decision will likely end Cuzzupoli\u2019s career in health services, though he is doubtful he will be paid the full $2.1 million. Either way, he said, the jurors\u2019 verdict is gratifying.<\/p>\n
\u201cIt\u2019s important that he no longer operates in this state, without some sort of designation,\u201d he said. \u201cHe\u2019s very good at keeping people who gave him money on the outside.\u201d<\/p>\n
Attempts to contact Cuzzupoli were unsuccessful.<\/p>\n
Balter and Arrakis Holdings extended four loans to three limited liability companies \u2014 including Blupoint Healthcare \u2014 from March 22, 2023, to May 10 of that same year. Cuzzupoli controlled all the companies.<\/p>\n
In addition to the foregoing loans, the plaintiffs transmitted an additional $250,000 to Cuzzupoli on April 14, 2023, in exchange for a promised 27.5% membership interest in CH Cuzzupoli Member LLC. Cuzzupoli\u2019s wife served as a trustee for this company, which owned and operated Community Hospice. According to the court\u2019s findings, Balter and Joseph Cuzzupoli agreed to treat the $250,000 as a loan, resulting in any membership interest the plaintiffs briefly may have held reverting to the Cuzzupoli Family Trust. In light of that agreement, the court characterized this $250,000 as a loan.<\/p>\n
\u201cCuzzupoli induced [the] plaintiffs to transmit the foregoing sums based on representations that the monies would be used to pay legitimate business expenses incurred by Cuzzupoli\u2019s nursing home and hospice businesses,\u201d Pineault wrote. \u201cCuzzupoli also specified the terms for each of the loans, including the interest rates that the nursing homes would pay and the maturity dates for the loans. Most of the loans were given the same maturity date: June 15, 2023.\u201d<\/p>\n
According to Pineault, Balter learned in or about mid-May 2023 that the nursing homes were in dire financial straits. Balter further learned from conversations with their chief financial officer that none of the loans the plaintiffs had extended during the previous eight weeks were reflected in the nursing homes\u2019 books and records, as the CFO knew nothing about them.<\/p>\n
\u201cUpon receipt of this information, Balter sent communications to Cuzzupoli confirming the upcoming June 15 maturity date for most of the loans and conveying his expectation that timely payment would be made,\u201d Pineault wrote. \u201cCuzzupoli said nothing in response to suggest that payment would not be made on June 15. In fact, he broached an opportunity for Balter to \u2018participate\u2019 in yet a further loan of funds. No payments were made on June 15. This action was filed soon thereafter.\u201d<\/p>\n
Balter said he eventually insisted on viewing some of the operations internally, and he immediately realized there were problems.<\/p>\n
\u201cI then knew that this was going to be a Major League problem,\u201d he said.<\/p>\n
Cuzzupoli admitted that he sometimes paid personal expenses out of nursing home bank accounts. Financial records introduced at trial showed that transfers were made from nursing home accounts to him. The records also showed transfers made out of nursing home accounts to pay amounts owed on Cuzzupoli\u2019s personal credit card.<\/p>\n
Cuzzupoli reportedly told Balter he viewed all of the nursing homes as \u201cone business\u201d and that he viewed their bank accounts as \u201cone\u201d also. Cuzzupoli also claimed that he took money from nursing home accounts to reimburse himself for business expenses he had paid personally and also in lieu of drawing a salary.<\/p>\n
\u201cCuzzupoli specified the accounts to which Balter was instructed to transfer the monies ostensibly being loaned to the nursing homes,\u201d Pineault wrote. \u201c[Cuzzupoli] never informed Balter that those accounts held commingled funds or that Cuzzupoli used the accounts to pay his personal expenses.\u201d<\/p>\n
Both sides in this case asserted consumer protection law claims against the other. However, jurors ruled against Cuzzupoli on his claim, finding that the plaintiffs had not committed any unfair or deceptive acts or practices in their dealings with him.<\/p>\n
The court also found that Cuzzupoli\u2019s consumer protection law violations entitle Balter and Arrakis Holdings to be reimbursed the reasonable attorneys\u2019 fees and legal expenses they incurred in bringing their claim.<\/p>\n","protected":false},"excerpt":{"rendered":"ATHOL \u2014 The co-founder of the limited liability company that owns two western Massachusetts nursing homes will be…\n","protected":false},"author":2,"featured_media":790900,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[59],"tags":[336248,97,252,253,336249],"class_list":["post-790899","post","type-post","status-publish","format-standard","has-post-thumbnail","category-health-care","tag-athol-ma","tag-health","tag-health-care","tag-healthcare","tag-south-hadley-ma"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/790899","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=790899"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/790899\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/790900"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=790899"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=790899"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=790899"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}