In a statement issued by Senior Housing Property, the firm saysthat it and Five Star Quality Care Inc. sent a notice of managementcontract terminations to Marriott Senior Living Services. Thenotice of terminations concerns 31 senior living communities with7,491 living units located in 13 states. These communities areowned by Senior Housing Property and leased to Five Star Quality.At the time these properties were acquired by Senior HousingProperty, they were subject to long-term Marriott managementcontracts. Senior Housing Property says that it determined toterminate Marriott's management contracts because it and Five Starbelieve "payments from Marriott to Five Star required under themanagement contracts have not been timely made and because SeniorHousing Property and Five Star believe Marriott has improperlyallocated charges to the operations of the 31 communities, whichresulted in greater profits to Marriott and lesser earnings by FiveStar from these communities."

Senior Housing Property and Five Star's lawsuit, which was filedin the Massachusetts Superior Court, is seeking a declaratoryjudgment that Marriott may not proceed with a transfer of themanagement contracts for these 31 communities as part of a plannedsale by Marriott of its Marriott Senior Living Servicesbusiness.

Roger Connor, spokesperson for Marriott tells thathis company, which he says filed the lawsuit in Maryland SuperiorCourt first, is seeking a declaratory judgment to prevent SeniorHousing Property from ending its management contract agreement withthe company. Connor acknowledges that Marriott is attempting tosell its Senior Living Services unit. He says that the company iscurrently in discussions with Sunrise Assisted Living to purchasethe division.

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