On August 2, 2024, Florida-­based Armor Health Management LLC petitioned the Miami-­Dade County Circuit Court to liquidate its assets to Enhanced Management Services (EMS), as part of a global settlement with creditors. That will free EMS and its owner, Dr. Jose Jesus Armas, of the bulk of debt owed by Armor—which Armas also founded.

The company’s original petition to assign its assets, filed in the circuit court on October 11, 2023, disclosed that $1.455 million was owed to secured creditors, including BankUnited, plus $319,714.68 in outstanding payroll and related expenses; another $153.5 million in unsecured debt included unpaid bills owed to pharmacies, consultants, diagnostic services, clinics and other subcontractors. It also included $12 million in verdicts and settlements in over 100 lawsuits filed by current and former prisoners or their estates.

Armor named Daniel J. Sterner with Development Specialists, Inc. as its assignee to “liquidate the assets of [its] estate” and then “pay and discharge in full, to the extent that funds are available … all of the debts and liabilities now due.” BankUnited sold its note to Merrick Bank, which negotiated a $3 million loan balance that was included in the assets EMS agreed to buy. Under the settlement agreement then reached on July 16, 2024, Armor’s remaining creditors also agreed to take a haircut, accepting $3.3 million in cash and agreeing to hold another $12.7 million in debt from EMS—pennies per dollar owed.

The cash includes an earlier agreement by EMS to purchase Armor’s last remaining jail healthcare contract in Texas’ Nueces County Correctional Facility for at least $650,000, as PLN reported. [See: PLN, Aug. 2024, p.26.] Armor also reported $109.9 million in accounts receivable, the latter “subject to set-­off claims” by at least 19 subsidiaries, to which it owes over $133 million—representing the vast majority of its unsecured debt. See: In re Armor Health Mgmt. LLC, Fla. Cir. (11th Jud. Dist.), Case No. 2023-­024558-­CA-­01.

As part of its approval of the settlement and asset sale, the circuit court was also asked to subordinate over $6.36 million in consent judgments that Armor entered after the assignment to Stermer with two former Jacksonville Jail guards and their wives; Kenneth and Christine Vansant and Jeremy and Shannon Flanigan won those in a suit for damages suffered from a COVID-­19 outbreak in 2020.

Armor’s long sordid history of inadequate medical care was glaringly reflected in a May 2019 agreement with Wisconsin’s Milwaukee County to pay $6.75 million to settle a wrongful death suit filed by the family of Terrill Thomas, a detainee left to die of dehydration in a segregation cell at the county jail while Armor staffers ignored him, as PLN reported. [See: PLN, Feb. 2021, p.34.] Armor was held criminally liable for Thomas’ death in October 2022 after a jury found it guilty of abuse of residents in a penal facility and falsifying health records. See: State v. Armor Corr. Health Svcs., Wisc. Cir. (Milwaukee Cty.), Case No. 2018CF005720.

“It is extremely rare to prosecute a corporation, however, such a prosecution is justified in particularly egregious circumstances,” County District Attorney John Chisholm said.  

Additional sources: Jacksonville Tributary, Milwaukee Journal-Sentinel