The judgments are part of nearly $37 million in corporate debt the executives personally guaranteed to American bank BB&T Corp. Filings in U.S. District Court show Specialty and its various affiliates took out a $10.5 million line of credit with BB&T in 2008 and also took out a $35 million term loan, according to the report.
The loans were taken out during the company’s short-lived partnership with the D.C. government to operate United Medical Center. The District foreclosed on Specialty’s ownership of UMC in 2010.
More than five years later, the loans are in default and Specialty still owes BB&T $36.9 million in principal and interest. The bank sought a judgment in April.
Specialty Chairman James Rappaport personally owes the bank $6 million in principal, and Founder and CEO Robert Rummler owes $2 million in principal. Judge James Boasberg will wait for itemized interest statements before calculating the amount of interest the executives owe.
Specialty operates Specialty Hospital of Washington (D.C.), along with two skilled nursing centers and an outpatient surgery center.
A lawyer representing the executives did not immediately respond to a Washington Business Journal request for comment.
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