Clover CEO Sued Over Plan to Make CarePoint Hospitals Nonprofit

A minority investor in New Jersey’s CarePoint health system filed suit in Delaware against its other owners, including Clover Health Investments Corp. CEO Vivek Garipalli, challenging their plan to turn the chain’s three for-profit hospitals into charitable nonprofits.

The lawsuit, made public Tuesday in Delaware Chancery Court, targets affiliates of Garipalli, who owns 80% of the hospital network through a complex web of holding companies, and James P. Lawler, who controls another 10%. It was filed by an affiliate of Jeffrey Mandler, who owns the last 10%.

The partly redacted suit accuses Garipalli and Lawler of moving to donate their ...