A Birmingham company that is among the largest owners of hospital properties in the country is being accused of misleading investors by concealing that four hospitals it invested in were “distressed,” according to a lawsuit filed in federal court.

Medical Properties Trust announced its investment in four Pennsylvania hospitals in 2019 as part of a $1.55 billion investment in 14 hospitals.

From February 2019 until investors learned of the alleged fraud in February, the company “engaged in a widespread and multifaceted scheme to conceal from investors that, contrary to the company’s public representations, its portfolio of assets were severely distressed and non-performing such that they could not make their rent payments,” according to the suit filed last week by investor Fiyyaz Pirani in federal court in Birmingham. Pirani seeks to have

Besides the Birmingham company, three of its top executives — Chairman, President and CEO Edward K. Aldag, Executive Vice President and Chief Financial Officer R. Steven Hamner and Senior Vice President, Controller and Chief Accounting Officer J. Kevin Hanna — were named in the lawsuit.

Medical Properties Trust buys hospital buildings, then leases them back to the hospital operators. It was co-founded in 2003 by Aldag and is one of the country’s largest real estate investment trusts, or REITs.

The executives “knew that the adverse facts … had not been disclosed to and were being concealed from the public, and that the positive representations being made were then materially false and misleading,” the suit stated, claiming they are “liable for the false statements and omissions pleaded” in the suit.

A spokesman for the company could not be reached for comment on the legal filing.

The company “masked the distressed state of its tenants” and “fraudulently transferred hundreds of millions of dollars in what amounted to a bailout of financially distressed tenants” before allegedly concealing “its fraudulent transfers with fake construction projects with purportedly high capital expenses, despite the fact that the company entered into ‘triple-net leases,’ which meant that its tenants were obligated to pay a significant portion of expenses, such as real estate taxes, insurance, and maintenance,” the suit went on to claim.

As a result of the alleged maneuvers, Medical Properties Trust’s public statements “were materially false and misleading at the time they were made,” the filing states.

Investors only learned of the the company’s alleged actions, the suit claimed, after the investigative financial analysis firm Viceroy Research LLC began publishing a report in late January accusing Medical Properties Trust of engaging “in billions of dollars of uncommercial transactions with its tenants and their management teams in order to mask a pervasive revenue round-robin scheme and/or theft.”

Pirani’s lawsuit claims Viceroy Research’s report was validated on Feb. 23, when Medical Properties Trust disclosed an impairment charge of $171 million related to the Pennsylvania properties and a $112 million write-off of unbilled rent to the company it leased the Pennsylvania hospitals back to.

Also on Feb. 23, Medical Properties Trust’s chief operating officer stepped down and the company’s stock price fell nearly nine percent. By March 1, the suit stated, the stock plunged nearly 18 percent and the company lost more than $1.2 billion in value.

“As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s securities, Plaintiff and other Class members have suffered significant losses and damages,” the suit said.