Prospect Medical Accuses California Asset Buyer of Failure to Pay

Bankrupt Prospect Medical Holdings Inc. urged a court to enforce the sale of its California assets after buyer NOR Healthcare Systems allegedly failed to fulfill its obligations.

Prospect Medical said NOR Healthcare has repeatedly failed to pay amounts due to both the hospital network and third parties. The hospital network alleged in a Sunday motion filed in the US Bankruptcy Court for the Northern District of Texas that the buyer’s noncompliance over the past month has put it “at risk of administrative insolvency.”

NOR Healthcare allegedly failed to pay approximately $11.6 million in funding obligations, including post-bankruptcy accounts payable, capitation ...