Seven current or former residents are suing the K-Nopf Assisted Living Center. They say they each paid between $50,000 and $85,000 for an "entrance fee."
And according to their contract, the fee was supposed to be similar to a refundable deposit to be paid back nearly in full if the resident moved out or died.
But those people haven't received their money.
Five of the plaintiffs are people who moved out of the K-Nopf apartments. One is the family of a woman who died. And the other is an 83-year-old man who wants to move out, but can't afford to without getting his $70,000 deposit.
After earning a living for most of his life as a machinery salesman in Sioux Falls, 83-year-old Marshall White moved into an assisted living center to make his life easier.
"Well, I was getting tired of taking care of a place," White says.
He sold his house and, like several others, paid $70,000 dollars to the K-Nopf Assisted Living Center for the "entrance fee."
"They told these people, and got them to sign the contract by assuring them that these deposits were refundable," says White's lawyer Rob Carl.
Carl says according to the contract White and other residents signed, the Knopf family guaranteed to pay back almost the entire the entrance fee or deposit, if a resident stopped living there.
"These people ended up moving out for one reason or another, and word started filtering around that these 'refundable deposits' were not being paid back," Carl says.
According to state law, nursing homes are supposed to put a resident's money in a secure account or trust. But Michael Knopf, one of the K-Nopf owners admitted in a bankruptcy hearing that the residents' deposits were instead put into the company's general operations account. And in the bankruptcy process, the bank took that money.
"We're figuring it's somewhere between $350,000 and $500,000," Carl says.
"I just get disgusted," White says.
White wants to move out, but can't afford to without that deposit.
Lou Raguse: "Would you have signed that contract if you knew you wouldn't get that money back?
White: "No! If i knew I'd be screwed out of my money, no, I wouldn't have signed it."
He, like 6 others who used to live at the K-Nopf Assisted Living Center, just wants his money back.
"To me, it's a lot of money. It was a lot of money, and it is a lot of money," he says.
The Knopf family did not return a phone call asking for comment. They are not facing criminal charges right now.
In the lawsuit, the assisted living center residents are suing for breach of contract, negligent misrepresentation, and conversion for putting the money in the general account.
