AUSTINTOWN — The fate of California Palms is expected to be swayed by a court hearing Tuesday, when creditors of the operator of the former hotel-turned-rehab will push to vacate the premises at state Route 46 and Interstate 80.

Attorneys for Pender Capital Asset Based Lending Fund will be in the courtroom of Common Pleas Judge John Durkin at 9 a.m. Magistrate Dominic DeLaurentis is expected to hear the charges that California Palms operator Sebastian Rucci has defaulted on an agreement reached in court last May that called for the closing of the rehabilitation center and payment of California Palms’ debts.

Rucci, however, told The Vindicator the rehab is still open and treating patients.

“We secured a loan last March,” Rucci said, claiming that the Pender lenders underfunded that loan. “We have been in court for the past 16 months. This latest filing is nothing new. We secured refinancing, and the hearing is simply a tactic to put pressure on us to close. We are confident we will get this concluded without a hearing.”

Rucci said he wants to continue treating patients because there is a shortage of beds providing inpatient care for drug addiction.

“The last thing this area needs is another empty building,” Rucci said.

Pender’s lawyers, in its motion filed Oct. 18, want the court to enforce the settlement that Rucci signed in May.

The motion by Pender wants the court to find Rucci in civil contempt; prevent Rucci from accepting any more patients at the rehab and force Rucci to pay back real estate and other taxes and utility bills plus all unpaid rental payments.

Pender’s motion also states Rucci missed an August deadline to pay $4.05 million. A supplement to the motion also shows that California Palms owes more than $99,000 to unsecured creditors, and that California Palms has assets amounting to about $10.5 million. A tax document shows the rehab owes more than $21,000 in back taxes and penalties.

Rucci did not comment about the missed payments on the loan and taxes.

This hearing is the latest turn for California Palms, which was a place of controversy before it opened as a hotel in April 2015.

Rucci had problems getting a liquor license and then had to change the name from the original Hotel California.

In 2017, the hotel closed and then reopened as a drug recovery center. In the summer of 2018, Rucci filed a civil lawsuit in an attempt to gain state certification for addiction services. At the time, the Ohio Department of Mental Health and Addiction Services objected to some practices at the facility, but Rucci claimed the state agency didn’t give him a timetable to fix the issues.

gvogrin@tribtoday.com