Attorney General Mayes Adds Racketeering Claims in Heritage Village Lawsuit, Seeks Receivership for Two Additional Assisted Living Facilities

PHOENIX - Attorney General Kris Mayes today filed an amended complaint in the state's ongoing lawsuit against Heritage Village Assisted Living, adding racketeering claims and asking the court to take control of Visions Mesa and Visions Apache Junction, two other assisted living facilities controlled by the owners of Heritage Village.

These new claims stem from evidence discovered during the lawsuit, as well as evidence uncovered by Peter Davis, the receiver appointed by the court to take over operations of Heritage Village.

"My office took decisive action earlier this year to protect the residents of Heritage Village by barring the owners from operating the facility," said Attorney General Mayes. "Since then, we've discovered just how critical those actions were. We are now amending our complaint to include new evidence uncovered by my office and the receiver overseeing operations."

After filing the original lawsuit in March 2024, the Attorney General asked the court to appoint Peter Davis as receiver for Heritage Village, with the twin goals of bringing in a new professional management company to improve resident care, and preventing Heritage Village from losing its license to operate in a revocation proceeding initiated by the Arizona Department of Health Services ("ADHS").

Mr. Davis has achieved both of those goals, engaging Mission Management Services LLC to improve resident care and negotiating a settlement with ADHS to preserve the license. Mr. Davis is now working on finding experienced owners to purchase Heritage Village.

Between the receiver's investigation of the facility's financial condition and the ongoing litigation, new facts emerged about the previous ownership and management of the facility, including:

• More than $2.9 million was diverted from Heritage Village operating accounts at the behest of owners Gary and Tracy Langendoen. The funds that should have been used to pay for the care of Heritage Village residents were instead used to pay debts for other properties in the Langendoen real estate empire or simply transferred directly to other companies controlled by the Langendoens.
• The transfers included at least $890,000 moved from Heritage Village to Visions Apache Junction and at least $52,000 to Visions Mesa.
• The insurance policy for Heritage Village was cancelled after the owners failed to pay the premiums. Gary Langendoen raised $200,000 from investors to reinstate the insurance, but he never gave that money to the insurance company. As a result, the receiver had to secure coverage from an "insurer of last resort" at a cost of more than $500,000.
• The Langendoens treated all of the facilities they owned as "one big family," freely moving money and even supplies between Heritage Village and other facilities in Arizona, Utah, Colorado, and California, all without proper accounting or documentation.
• Heritage Village filed at least six license applications with ADHS between October 2022 and August 2023, and every one of those applications was a forgery under Arizona law. Not only did the applications contain false information, but Heritage Village also submitted fake supporting documents (including leases and operating agreements) containing forged signatures.
• While Heritage Village residents suffered horrific abuse and neglect and their rent payments were diverted to uses other than resident care, the Langendoens forced Heritage Village to pay $25,000 per month to one of their own companies for management and accounting services.

"This much money moving between facilities indicates that many, if not all, of the facilities are in dire financial straits, and the Langendoens have no qualms about looting one facility to keep another afloat," said Attorney General Mayes. "We are asking the court to remove the Langendoens from control of the two Visions facilities before they reach a crisis point and put the residents in even more danger."

In addition to expanding the receivership, the updated lawsuit seeks treble damages against Gary Langendoen, Tracy Langendoen, and two high-level employees for racketeering activities, including forgery, scheme or artifice to defraud, and illegal conduct of an enterprise. The amended complaint also expands on the allegations of consumer fraud and elder abuse in the original complaint.

"Our most important task is protecting the vulnerable residents who are still living in Langendoen-controlled facilities, and bringing in new owners who will run those facilities properly," said Attorney General Mayes. "Once the residents are safe, we will focus on bringing accountability to the people who caused all of this to happen."

The lawsuit is State of Arizona v. Heritage Village Bldg2, LLC et. al., Maricopa County case number CV2024-005359. The attorneys handling the case are Senior Litigation Counsel Shane Ham and Assistant Attorney General Liza Lawson Risoldi. Peter S. Davis, of J.S. Held, LLC serves as receiver at Heritage Village and will be nominated to serve in that capacity for Visions Mesa and Visions Apache Junction.

"As I said when we filed this lawsuit, assisted living facilities in Arizona should be run by qualified health care providers, not property flippers," said Attorney General Mayes. "The sheer magnitude of the Heritage Village fraud is shocking, but sadly it is not surprising. I will file as many lawsuits as it takes to assure Arizona families that their payments are being used to provide care for their loved ones, not skimmed away by real estate speculators and outright scammers."

Copies of the amended complaint and initial receiver's report are available below.

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