LOS ANGELES — A funeral home company has sued the Archdiocese of Los Angeles for at least $250 million, alleging it was cheated out of a lease deal involving six Roman Catholic cemeteries.
S.E. Funeral Homes of California Inc. alleges breach of contract, bad faith and unjust enrichment in the suit filed Monday in Superior Court.
But the archdiocese said Tuesday that it’s in the right.
The lawsuit said the archdiocese agreed in 1997 to allow S.E. Funeral Homes to lease land on or near six cemeteries to operate funeral service businesses for 40 years.
The company said it spent about $37 million to build funeral homes, offices, flower shops, chapels, mausoleums, and other features at All Souls Cemetery in Long Beach, Calvary Catholic Cemetery in East Los Angeles, Holy Cross Cemetery in Culver City, Queen of Heaven Cemetery in Rowland Heights, San Fernando Mission Cemetery in Mission Hills, and Santa Clara Cemetery in Oxnard.
The company said it pre-sold about $190 million worth of services and expected to receive the money in future years.
However, on Sept. 5 the archdiocese notified the company that it intended to end the leases on Oct. 3, the suit said.
The lawsuit said the company was notified that it had breached the leases because it didn’t seek permission from the archdiocese before the funeral home’s corporate owner, Stewart Enterprises Inc., agreed to a reverse merger with a subsidiary of Service Corp. International.
The lawsuit contended that the company didn’t need such permission and alleged that the archdiocese is making a trumped-up allegation in order to seize the company’s lucrative business.
However, the leases “specifically prohibit their transfer or entrustment of operations without the prior written consent of the archdiocese,” Monica Valencia, spokeswoman for the archdiocese, said in a statement.
Cemetery services won’t be interrupted by the legal dispute, the statement said.