A Maryland federal judge has awarded $850,000 in attorney fees to a shareholder of Omega Healthcare who filed a derivative lawsuit accusing the healthcare investment trust of discriminatory practices aimed at excluding Black individuals from its board of directors.
Healthcare Co $850K Attorney Fees : Settlement and Attorney Fees
U.S. District Judge James K. Breder approved the settlement and granted final approval to the attorney fees on Thursday. Plaintiff Robert Wojcik, who brought the suit, will also receive a $2,000 service award, with Judge Breder deeming all requested awards reasonable. Additionally, roughly $17,500 in litigation costs were awarded to Wojcik’s legal team.
Corporate Governance Reforms
As part of the settlement, Omega Healthcare has agreed to implement a series of corporate governance reforms for at least two years. These reforms include:
- Appointing a new and diverse director to the board.
- Establishing a new process for board appointments, aiming to include at least two members from underrepresented groups in the candidate pool.
- Creating a new process for hiring senior leadership.
- Launching a diversity training program.
The memo accompanying the settlement noted that Omega had already begun implementing these reforms, including the appointment of an African-American female director to its board in 2021.
Healthcare Co $850K Attorney Fees: Background of the Lawsuit
The lawsuit, filed by Wojcik in 2020, accused Omega Healthcare and several of its executives of failing to nominate, appoint, or hire Black individuals for executive positions. Wojcik alleged that the defendants breached their fiduciary duties and misled investors by claiming to adhere to anti-discrimination policies. The complaint highlighted that Omega’s leadership made “no real efforts to promote diversity” on its board or among senior executives, and suggested that the company avoided term limits on the board to keep Black individuals from being appointed.
Omega’s Business and Allegations
Omega Healthcare is a real estate investment trust that focuses on healthcare facilities, such as senior care facilities, by either owning the properties or providing mortgage financing to operators. Wojcik’s complaint further alleged that Omega’s proxy statements misrepresented the board’s diversity and failed to disclose discriminatory practices. The complaint asserted that the company did not consider racial diversity in its board nominations and lacked adequate internal controls.
Healthcare Co $850K Attorney Fees : Legal Representation
Wojcik was represented by Timothy Brown of The Brown Law Firm PC, Camille Wagner of Wagner PC, and Mark Cotton. Omega and the individual defendants were represented by Robert S. Campbell and Steven A. Allen of Pessin Katz Law PA.
