Centene investors may receive additional information about the case by clicking the link "Join this Class Action" above.
According to the complaint, Centene provides health plans in over twenty states through Medicaid, Medicare, and the Health Insurance Marketplace. On March 24, 2016, the company completed the acquisition of Health Net, Inc. (“Health Net”) for approximately $6 billion, including the assumption of debt. The acquisition was accounted for as a business combination, which requires that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date.
The Class Period commences on April 26, 2016, when Centene published a press release announcing first quarter 2016 results, and provided 2016 guidance of revenues of $39.8 billion at the high end.
The complaint further alleges that on May 10, 2016, Centene provided financial information to investors concerning the completed acquisition of Health Net. Therein, the company incorrectly accounted for Health Net’s underperforming health plans, including by understating certain reserves to account for losses in California, Arizona and Oregon.
On July 26, 2016, the company filed a report with the SEC on Form 8K, stating that it was reserving approximately $300 million for losses associated with Health Net’s insurance plan. Following this news, Centene’s shares price fell $6.39 per share, or over 8%, to close at $68.87 per share on July 26, 2016, on heavy trading volume.
Finally, on September 6, Leerink Partners, LLC issued a report downgrading Centene stock due to underperformance of the Health Net legacy insurance programs, including Health Net’s California substance abuse programs. Following this news, Centene’s shares fell $3.32 per share, or 5%, to close on September 6, 2016 at $65.30.
The complaint alleges that throughout the Class Period, the defendants made false and/or misleading statements and/or failed to disclose: (1) that certain Health Net insurance programs were significantly underperforming; (2) that Health Net’s insurance plans were generating material losses; (3) that Centene had overstated Health Net’s financial prospects; and, (4) that, as a result of the foregoing, the defendants’ statements about Centene’s business, operations, and prospects, were false and misleading and/or lacked a reasonable basis.
If you are a member of the class described above, you may no later than January 13, 2017, move the Court to serve as lead plaintiff of the class, if you so choose.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of their choice, or may choose to do nothing and remain an inactive class member.
Kessler Topaz Meltzer & Check, LLP has not filed a complaint in this matter. If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at firstname.lastname@example.org.
Kessler Topaz Meltzer & Check, LLP
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