Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Universal Care Group Seeks Bankruptcy Protection Amid State Takeover
Author: Joel R. Glucksman
Date: March 7, 2013
Key Contacts
Back
An investigation into Florida-based Universal Health Care Inc., has prompted the insurer to file for Chapter 11 bankruptcy protection while regulators attempt to take over the company.
The Medicare insurer operated by Dr. A.K. Desai recently underwent a state investigation, in which regulators report that “a pattern of mismanagement” and unlawful financial management has left the company “insolvent or about to become insolvent,” according to the Tampa Bay Times. In addition, the report noted that Universal grossly overstated its assets. Further, a high turnover rate among the Chief Financial Officer position may have also been a factor in the company’s volatile position.
Further, Universal was at risk of defaulting on its $60 million credit line with BankUnited three times since October, and financial statements reveal that the company was insolvent by as much as $12.6 million as of Dec. 31, 2012, the news source reports. The bank noted that many of the statements provided by the company were inaccurate or misleading, the newspaper notes.
The findings of the investigation resulted in state seizure of the insurer and prompted it to seek protection under bankruptcy law. However, company CEO Desai said in an emailed statement to the Tampa Bay Business Journal that the two courses of action are unrelated. A high rate of defection as a result of poor quality may be a contributing factor to the company’s bankruptcy, according to the Times.
Although the company plans to reorganize under Chapter 11, analysts argue that its ability to do so will rely on the final results of the state investigation. The company was founded in 2002, and grew to cover residents in 20 states across the country. However, it has already signed agreements to merge some of its companies in Florida, Texas, and Nevada to begin its cost-cutting measures.
- Practices: Bankruptcy & Creditors' Rights, Corporate Transactions & Business, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
The SEC’s Latest Guidance on Applying Federal Securities Laws to Tokenized Securities
On January 28, 2026, staff of the U.S. Securities and Exchange Commission’s Divisions of Corporation Finance, Investment Management, and Trading and Markets issued a joint statement clarifying how existing federal securities laws apply to tokenized securities. The SEC’s “Statement on Tokenized Securities” does not establish new law, but it does provide greater clarity on the […]
Author: Dan Brecher
Common Legal Mistakes NYC and New Jersey Business Owners Make
Operating a business in the New Jersey and New York City metropolitan region offers incredible opportunities, but it also requires navigating a dense and highly regulated legal environment. From entity formation to regulatory compliance, seemingly minor legal oversights can expose business owners to significant risk. In our work with businesses throughout the region, our attorneys […]
Author: Dan Brecher
What Founders Can Learn From Start-up Suits
High-profile founder litigation is more than just a media spectacle. For startup founders, these cases underscore the legal and structural risks that can arise when rapid growth outpaces formal oversight. While launching a new company can be both an exciting and deeply rewarding endeavor, founders must be mindful that it also comes with significant risks. […]
Author: Dan Brecher
Corporate Governance Reviews: A Practical Guide for New Jersey Companies
Every New Jersey company should periodically evaluate its governance framework. Strong corporate governance protects directors and officers, builds investor confidence, reduces litigation exposure, and positions a company for sustainable growth. The first quarter of the year is a great time to evaluate your corporate governance practices and perform any routine maintenance needed to keep that […]
Author: Ken Hollenbeck
What to Do After Being Served with a Lawsuit: Steps to Protect Your Legal Rights
Being served with a lawsuit is one of the most stressful legal events a business or individual can face. Whether the claim involves a contract dispute, an employment matter, an intellectual property issue, or another legal challenge, the actions you take in the first few days can significantly shape the outcome of your case. Acting […]
Author: Robert E. Levy
Will 2026 Be a Banner Year for SPACs? Understanding the Risks and Opportunities
Special Purpose Acquisition Companies (SPACs) continue to gain momentum as we move through 2026. After enduring a significant contraction following the 2021 boom and the regulatory scrutiny that followed, SPAC activity rebounded sharply in 2025 and now carries forward into 2026 with real momentum. The SPAC resurgence reflects broader improvements in both market conditions and the […]
Author: Dan Brecher
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.