Steward Health Sues Ex-CEO Over ‘Greed’ That Led to Collapse (2)

Bankrupt Steward Health Care System LLC hit former insiders, including ex-CEO Ralph de la Torre, with a nearly $1.4 billion lawsuit alleging they “pilfered” the health-care network’s assets for their own gain.

The former executives “through greed and bad faith misconduct” enriched themselves at the expense of Steward Health and creditors via a series of transactions in 2021 and 2022, Steward Health said in a suit filed Tuesday in the US Bankruptcy Court for the Southern District of Texas.

“These insiders pilfered Steward’s assets for their own material gain, while leaving the Company and its hospitals perpetually undercapitalized and insolvent,” the suit said. “Their misconduct ultimately led to Steward’s collapse and the filing of these chapter 11 cases.”

Steward, once the largest privatized health-care network in the country, filed for bankruptcy last year. Its collapse attracted scrutiny from lawmakers and prompted calls to launch a criminal probe targeting de la Torre.

Steward’s liquidation plan was approved by a Houston bankruptcy judge Wednesday.

The company’s suit seeks to recover nearly $1.4 billion from a broad range of insiders and related entities, including about $251 million from de la Torre and companies Steward said served as his alter egos. Steward also seeks to avoid hundreds of millions of dollars in transfers.

“Dr. de la Torre disputes the allegations of wrongdoing and will vigorously defend himself against them,” a spokeswoman for the former CEO said in an emailed statement Wednesday.

Steward also alleged damages for breaches of fiduciary duty, interference with contracts, and conspiracy and aiding and abetting fraudulent transfers. The suit accuses several former Steward board members in helping facilitate the deals.

Steward said de la Torre in January 2021 orchestrated a $111 million dividend that benefited insiders while the company was insolvent. The former CEO personally received $81.5 million of that dividend and within months “purchased himself a $30 million superyacht, which he continues to enjoy to this day,” the company alleged.

De la Torre also helped drive a June 2021 deal through which Steward overpaid by about $205 million for five Miami-area hospitals and their associated doctor practices from Tenant Healthcare Corp., according to the complaint. The $1.1 billion purchase price for the Miami hospital network was higher than the $895 million it was initially valued at because of de la Torre’s “personal desire to build a hospital empire in the Miami area, rather than on any independent financial analysis,” the complaint said.

The Tenant deal was meant to rely on cash from the sale of five hospitals in Utah, but it was struck before the Utah deal was finalized, according to the complaint. The Utah sale was delayed, then in June 2022 blocked by the Federal Trade Commission due to antitrust concerns, the suit said.

When the Utah hospitals eventually sold in May 2023, the purchase price was about $165 million less than a previous offer and led to Steward being unable to properly invest in integrating the Miami hospitals, according to the complaint.

In 2022, de la Torre also led a sale of Steward’s Medicare Advantage business to CareMax Inc., the suit said. About $134 million of the proceeds from that sale were diverted to entities indirectly owned by Steward insiders, including SHC Holdings Board—which was led by de la Torre and certain board members, according to the complaint. Steward was left with only about $60.5 million of the proceeds, the complaint said.

Steward was founded in 2010 by Cerberus Capital Management LP as a way to buy Caritas Christi Health Care, a Massachusetts-based network of six hospitals. The complaint said in 2020 de la Torre restructured the company’s structure to cut out Cerberus, avoid the Steward board, and “facilitate his raid of company cash.”

Steward is represented by Kobre & Kim LLP in the suit.

The case is Steward Health Care System LLC et al v. De la Torre et al, Bankr. S.D. Tex., No 25-03593, complaint 7/15/25.