In a pathbreaking decision shaping the future of one of Brooklyn’s most historic hospitals, Justice Denise A. Hartman of the New York State Supreme Court, Albany County, today annulled the New York State Department of Health’s approval of the proposed $2.245 billion takeover of Maimonides Medical Center by New York City Health + Hospitals (“H+H”).

Granting the Article 78 petition brought by Refuah Helpline, the Borough Park Kehilos of Bobov, Belz, Satmar, and Bobov 45, and individual community members, the Court held the Commissioner’s November 10, 2025 determination “arbitrary and capricious and affected by error of law,” and ruled that the transaction cannot proceed without the full public-health review the Legislature required—including review and approval by the Public Health and Health Planning Council (“PHHPC”) under Public Health Law § 2801-a.

The Court framed the stakes in a companion ruling issued the same day: this case, Justice Hartman wrote, “concerns a municipalities’ takeover and operation of a private hospital—an issue of significant public importance involving the provision of healthcare services, the substantial expenditure of public resources, and the continued availability of medical care to the community.” That public importance is what today’s decision—together with the Attorney General’s March 20 ruling requiring full court review of the transfer of Maimonides’s nonprofit assets, and the pending Trustees’ fiduciary-duty action in Kings County—now ensures will be evaluated in public, on a full record, by the institutions New York law has charged with that responsibility.

Restoring the Public Scrutiny Maimonides’s Leadership Has Sought to Avoid

Today’s ruling comes amid swelling community opposition to the proposed transfer of Maimonides into the City’s municipal hospital system. South Brooklyn families, patient advocates, religious institutions, and physicians have been vocal in their concern that the takeover will harm—not improve—the health of the communities Maimonides serves.

Today’s ruling comes amid swelling community opposition to the proposed transfer of Maimonides into the City’s municipal hospital system. South Brooklyn families, patient advocates, religious institutions, and physicians have been vocal in their concern that the takeover will harm—not improve—the health of the communities Maimonides serves.

Community members have pointed to years of executive mismanagement as the real source of Maimonides’s financial troubles, and have warned that absorbing the hospital into a municipal system already facing chronic budget pressures, citywide competing demands, and a long record of regulatory and quality-of-care problems will not fix it. Out of those concerns, the public has increasingly asked whether the proposed transaction serves the public interest at all—both as a matter of community health and as a matter of the responsible use of nonprofit charitable assets.

Notwithstanding that opposition, the leadership of Maimonides has pressed forward, repeatedly seeking to consummate the transaction without the public scrutiny New York law imposes on transactions of this magnitude. New York law provides two distinct safeguards for a transaction of this kind: court review of the transfer of nonprofit charitable assets under Section 511 of the Not-for-Profit Corporation Law, and review by the Public Health and Health Planning Council (“PHHPC”) under Public Health Law § 2801-a of the public-health impact of the proposed operator change. Maimonides’s leadership sought to bypass both.

In March, the New York Attorney General’s Charities Bureau rejected Maimonides’s effort to obtain administrative approval of the transfer of its nonprofit assets to the City of New York, and directed that any such transfer be submitted to the New York State Supreme Court, Kings County, for full review under N-PCL § 511. Today’s ruling now subjects the transaction to the parallel public-health scrutiny under § 2801-a that Maimonides and H+H had likewise sought to avoid, holding that the Department of Health’s Safety Net Transformation Program (“SNTP”) approval—on which they had relied—does not, and as a matter of law cannot, substitute for PHHPC review.

In a parallel action in the New York State Supreme Court, Kings County, seven Trustees of Maimonides have sued the institution’s Board of Trustees and senior leadership, alleging that the directors breached their fiduciary duties by pursuing the transaction without an appropriate search for alternative partners, without adequate governance process, and without due regard for the hospital’s charitable mission and the communities it serves (Twerski v. Gibbs, Index No. 540340/2025). Together, the Attorney General’s March 20 decision, today’s ruling, and the Twerski action reflect a broad judgment—from regulators, from the courts, and from within Maimonides’s own governance—that the proposed handover of one of Brooklyn’s largest private nonprofit hospitals to municipal control cannot proceed without the public scrutiny New York law was designed to provide.

In a Companion Decision, Court Also Rejects Maimonides’s Attempt to Seal the Asset Transfer Agreement

In a separate Decision and Order issued today (NYSCEF Doc. No. 65), Justice Hartman likewise rejected Maimonides’s effort to keep the operative transaction documents themselves out of public view. The Court denied Maimonides’s motion to permanently seal the Affiliation and Asset Transfer Agreement (“ATA”) and to redact references to it in the court record, holding that Maimonides “has failed to establish good cause” under 22 NYCRR 216.1 for such relief.

The Court found persuasive Petitioners’ argument that “MMC is improperly using confidentiality as both a ‘sword and shield’ by selectively disclosing favorable portions of the ATA while seeking to seal the document in full,” and concluded that “granting the requested relief would effectively shield from public view materials that inform governmental decision-making in an area of substantial public concern, thereby undermining transparency and public accountability.”

Statements from Counsel and Petitioners

“For generations, Maimonides has been the lifeline of Borough Park and South Brooklyn,” said Hanna Landau, Director and Founder of Refuah Helpline. “Our pediatric trauma center, our maternity hospital, our cancer center, our emergency room—these are not corporate assets to be quietly handed off in Albany. They are matters of life and health for the families we serve every day. Today, the Court restored the public-health review process that the people who depend on Maimonides have always been entitled to. We are grateful that the proposed transformation of our hospital will now be evaluated, in public, by the Public Health and Health Planning Council, including its rigorous review of who is fit to operate it.”

“This is a complete victory for transparency, for public health, and for the rule of law,” said Martin Bienstock of Bienstock PLLC, a counsel to Petitioners. “The Department of Health tried to package a $2.245 billion transfer of one of Brooklyn’s largest private hospitals into the City’s municipal hospital system inside a grant program, and use that grant program to bypass the public-health review the Legislature mandated for exactly this kind of transaction. The Court saw through that effort. Combined with the Attorney General’s decision in March, today’s ruling means a transaction that Maimonides’s leadership tried to push through in Albany will now be evaluated where it should be—in public, before the institutions New York law was designed to provide.”

“We are grateful that the Court rejected each and every argument raised by the Department of Health, Maimonides Medical Center, and New York City Health + Hospitals in a careful, rigorous application of the Public Health Law,” said Akiva Shapiro of Holtzman Vogel, co-counsel to Petitioners. “The Court underscored what was always at the heart of this case—that a transaction of this magnitude, which would fundamentally transform a cherished and storied nonprofit community hospital and hand it to the City of New York to be folded into the municipal hospital system, cannot be rubberstamped and must instead undergo rigorous public review by independent public health experts. And now it will.”

Background

Maimonides Medical Center is a 711-bed nonprofit teaching hospital located in Borough Park, Brooklyn. Approximately 85% of its patients are covered by Medicare or Medicaid. It is one of Brooklyn’s largest hospitals and operates the borough’s only comprehensive children’s hospital, its only Pediatric Trauma Center, a Regional Perinatal Center, a Joint Commission–designated Comprehensive Stroke Center, and Brooklyn’s only Left Ventricular Assist Device and ECMO programs, among many other specialty services.

By Award Letter dated November 10, 2025, the New York State Department of Health approved approximately $2.245 billion in funding over five years under the Safety Net Transformation Program (PHL § 2825-i) to support a transaction in which H+H—the nation’s largest municipal hospital system— would take over Maimonides. In December 2025, the parties entered into an Affiliation and Asset Transfer Agreement transferring substantially all of Maimonides’s assets, liabilities, operations, governance, and licensure to H+H, and creating new H+H-controlled entities to operate the hospital under the name “H+H Maimonides.”

Petitioners commenced this Article 78 proceeding on March 9, 2026. On March 11, 2026, the Court entered an Order to Show Cause and temporary restraining order. Today, having received full briefing on the merits, the Court issued its Decision, Order, and Judgment in Refuah Helpline, et al. v. McDonald, et al., Index No. 902792-26 (Sup. Ct. Albany Cnty., May 12, 2026) (Mot. Seq. #1), annulling the Commissioner’s determination and remitting the matter to DOH for further proceedings consistent with the Court’s ruling. The Court held the Commissioner’s determination “arbitrary and capricious and affected by error of law.”

Separately, on March 20, 2026, the New York Attorney General’s Charities Bureau rejected Maimonides’s request for administrative approval of the transfer of nonprofit assets to the City of New York, and directed that the transaction be submitted for full court approval under Section 511 of the Not-for-Profit Corporation Law. In addition, seven Trustees of Maimonides have sued the institution’s leadership in Kings County Supreme Court (Twerski v. Gibbs, Index No. 540340/2025), alleging breach of fiduciary duty in the pursuit of the transaction.

Key Holdings

• The SNTP grant does not exempt the transaction from PHHPC review. Public Health Law § 2825-i authorizes the Commissioner to waive regulatory requirements but does not authorize him to waive the underlying statutory requirements of Public Health Law §§ 2801-a and 2802. The Court squarely held: “Public Health Law § 2825-i authorizes waivers only of regulations, not the statute.”

• The Commissioner’s SNTP review is not a substitute for PHHPC review. The Court found that the SNTP award letter does not even purport to address the “character and competence” review that § 2801a(3)(b) requires—precisely the inquiry petitioners argued is most critical given H+H’s record of regulatory violations and recurrent “immediate jeopardy” citations.

• H+H’s status as a New York City public benefit corporation does not exempt the transaction. The Court rejected the Commissioner’s argument that Public Health Law § 2801-a(5)’s carve-out for hospitals established “by the city of New York” exempts the transaction. The carve-out, on its face, does not cover changes in hospital operator under § 2801-a(4)—which was added in 1970, after H+H was created—and, in any event, “does not on its face exclude from Public Health Council approval changes in the operational governance of a hospital.”

• Both § 2801-a (Establishment) and § 2802 (Construction) apply. The Court held that the transaction—which creates new H+H-controlled entities to operate the hospital, restructures Maimonides’s governance, and transfers operational control and licensure to H+H—triggers both establishment review under § 2801-a and construction/“substantial acquisition” review under § 2802.

• Petitioners have standing. The Court found that the individual petitioners—Brooklyn community members who, with their families, regularly receive care at Maimonides—and the organizational petitioner Refuah Helpline (a 501(c)(3) that services thousands of MMC patients) easily satisfied the injury-in-fact and zone-of-interests requirements, and that Public Health Law § 2801-c provides additional, relaxed standing for the relief petitioners seek.