Dueling Lawsuits Between Malibu Rehab Centers Expose the Shady Side of the Recovery Industry

As Passages Malibu and Cliffside Malibu go head to head, it’s a showdown on the Rehab Riviera

As the opioid epidemic rages across America, two of L.A.’s iconic luxury addiction rehab centers have been embroiled in a multimillion-dollar lawsuit revealing the less savory tactics of the treatment industry. Located less than three miles from each other on Pacific Coast Highway, Passages Malibu and Cliffside Malibu are among the most famous (and expensive) treatment centers in the world—known for their celebrity clientele, deluxe digs, and extravagant rates.

The battle between the two behemoths culminated in a lawsuit filed by Passages in February 2018 and a countersuit filed in August by Cliffside in which each rehab center accuses the other of false advertising and underhanded practices in a cutthroat race to fill their beachside facilities with clients. The massive advertising budgets and fake news sites uncovered in the litigation depict a Wild West of rehabilitation marketing, where people suffering from addictions are treated as profitable “leads.”

Passages and Cliffside surged into the public consciousness in the early 2000s as stars like Mel Gibson, Lindsay Lohan, and Marc Jacobs arrived at their doors in pursuit of sobriety, privacy, and plush sheets of Egyptian cotton. The centers’ brash founders—Passages’ Pax Prentiss and Cliffside’s Richard Taite—are fixtures of the celebrity gossip circuit; both leveraged their personal addiction struggles into profitable recovery empires. A 30-day private room at Passages costs $112,000; an equivalent stay at Cliffside reportedly runs up to $68,000. Patients at both facilities enjoy a regular regimen of acupuncture, equine therapy, chef-prepared meals, and priceless ocean views, but critics charge that the focus on opulence comes at the expense of evidence-based treatment.

As early entrants into the Southern California rehab industry, Passages and Cliffside have always fought for clients—a competition that only grew more intense with the explosion of new treatment centers in the area. There are more than three dozen state-registered recovery or treatment facilities in Malibu, earning the affluent town of roughly 13,000 the often-derided title Rehab Riviera.

The current feud began in 2013, when Taite, Cliffside’s blustery founder, purchased TheFix.com, a popular addiction recovery website best known for reviewing treatment centers. (Los Angeles editor-in-chief Maer Roshan cofounded TheFix in 2011.) Court filings show that Taite bought the site out of bankruptcy and concealed his ownership from the public. While TheFix claimed to be an unbiased resource for people seeking addiction therapy and advice, Taite sought to boost Cliffside’s rating on the site and demanded changes. “Get rid of that whole paragraph!” he told TheFix editor-in-chief Allison McCabe in 2017 in reference to a story that covered treatment for Kourtney Kardashian’s partner Scott Disick. “Please stop giving other rehabs credit for my fucking work!” A 2017 story by the Verge exposed Taite’s ownership of TheFix, and Passages filed its lawsuit shortly thereafter.

Financial records uncovered during the suit show that Taite also pumped millions of dollars into an unbranded referral line heavily promoted on TheFix. In court Taite admitted that individuals who called the hotline were told they had reached a network of providers, apparently not disclosing the line’s purpose as a customer lead generator for Cliffside and its affiliates. “That was the whole idea,” Taite said of the roughly 1,400 monthly callers, to generate clients.

Passages’ primary accusation, however, concerns a scathing review that appeared on TheFix in 2011 and remained online after Taite bought the site. Passages alleges that Taite orchestrated a “false advertising scheme” using the negative review to lure clients from Passages. “I was being blackmailed,” complained Prentiss, 45, the addiction rehab impresario who cofounded Passages with his father, Chris. Testifying in February 2019, Prentiss detailed his attempts to have the review removed, only to be rebuffed with offers of a re-review. “It’s like negotiating with somebody that wants to hurt you, and I don’t want to do that,” he said.

“A lot of things that happen commonly in the addiction world would be malpractice if they occurred in mainstream medical care.” —Dr. Sarah Wakeman

Taite and Cliffside filed a countersuit exposing that Prentiss’s network of unbranded referral websites had been used for nearly a decade to “get traffic, and get CALLS,” as Prentiss wrote in an email in 2009. Prentiss subsequently ordered a campaign in 2016 to “get Fix off our back.” Among the sham sites directing consumers to Passages were a fake newspaper; a nonexistent college; and “baltimorehealth.org,” which misleadingly featured the city of Baltimore’s official seal. Cliffside is “hiding behind journalism and fake reviews,” Passages employee Mark Bailey told Prentiss in an email at the time. “We’ll beat them at their own game.”

Ryan Hampton, an advocate for reform in the addiction industry, says deceptive advertising practices and big budgets have allowed Passages and Cliffside to “outgame” reputable treatment providers for the past decade. Taite, for instance, spent $25 million on advertising for his multiple properties from 2011 to 2018—more than four times the combined amount he spent on doctors, nurses, and therapists. In some years Cliffside spent more on massages than on therapists.

“It’s sad to see this play out in civil court because it should be in criminal court,” added Hampton. These online marketing tactics have “essentially kept people from getting real life-saving treatment.” (Passages and Taite declined to comment for this story. John Peloquin, president of Discovery Behavioral Health, which purchased Cliffside from Taite in 2018, said the rehab is “under new management and the former owner is no longer affiliated with our organization.” )

In building its case against Passages, Cliffside also accused the rehab center of spending $80 million on advertising that falsely promises a “cure” for addiction—a term often used by Passages but widely discredited by medical professionals.

“I cannot think of a more deliberate and cynical lie than to tell a sick person you are going to cure them,” said Cliffside attorney Brendan Maher, “that it will be effortless. And it will make their problems go away if only they would mortgage their home and give you $100,000, which is what Passages does.” In court, Cliffside’s lawyers made Prentiss acknowledge that his belief in a 60 percent cure rate is based not on credible science but on “feedback we get from the therapist.”

In February 2019 a jury sided with Passages, determining that TheFix under Taite falsely purported to be an independent site and that the review of Passages was not based on 20-question client surveys as it had claimed. The jury also found against Cliffside’s claim of a falsely advertised “cure.” But in July, Judge Stephen Wilson of the U.S. Central District Court in Los Angeles said that Passages showed a “deliberate intent” to create sham websites “for the purpose of deceiving the general public.” In awarding damages, he ruled that both sides acted “essentially the same.” Instead of winning millions, Passages was granted $60,000—an amount unlikely to cover its team of seven high-powered attorneys. (Both parties have appealed the decision.)

“A lot of things that happen commonly in the addiction world would be malpractice if they occurred in mainstream medical care,” says Dr. Sarah Wakeman, an addiction medicine specialist at Massachusetts General Hospital. “Patients are left trying to navigate this often very profit-driven system that can really prey on their vulnerabilities.”

According to his personal website, Taite once struggled with the idea of making a “business around others’ misfortune.” But an unnamed sage told him to repeat the mantra: “Wouldn’t the world be a better place if everybody could make a living helping people.” With that in mind, his multiple rehab properties—led by Cliffside—generated more than $160 million dollars in revenue from 2011 to 2018. Now Taite has left Cliffside and started a nonprofit that will advocate “monumental reform” in the industry. According to his website: “Richard sees himself as a warrior in this battle to clean up bad practices in the rehab business.”

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