AAC Holdings Announces Resolution with California’s Attorney General and All Charges Dismissed Against Corporate Entities. Penalty & others: $0.75 mm
On October 24, 2016, AAC Holdings, Inc. (NYSE: AAC) announced that certain of its subsidiaries have reached a resolution with the Attorney General of the State of California. Under terms of a stipulated settlement, which was entered by court order on October 21, 2016, the Attorney General of the State of California has dismissed all criminal charges against the Company’s subsidiaries, American Addiction Centers, Inc. (formerly known as Forterus, Inc.), Forterus Health Care Services, Inc. and ABTTC, Inc. in the case entitled People v. McCausland, et al. The case is regarding the criminal charges filed against the Defendants in connection with the death of a client in 2010 at one of the Company’s former locations.
As part of the settlement, the Company has agreed to implement and maintain over the next three years certain compliance, internal audit and quality review programs to ensure high standards for safety, reliability and clinical outcomes for its operations in California. These programs will be monitored by an independent party for effectiveness at the Company’s expense. AAC will pay the State of California $549,986 for costs related to the legal proceedings and $200,000 as a civil monetary penalty.