HCP investors may receive additional information about the case by clicking the link "Join this Class Action" above.
According to the complaint, HCP is a real estate investment trust (“REIT”) focused on the healthcare industry. Throughout the Class Period, HCP was highly dependent upon the operations of ManorCare, a nursing home operator with facilities in Ohio and elsewhere, which served as HCP’s most significant client. Prior to the start of the Class Period, HCP invested directly in ManorCare, purchasing substantially all of ManorCare’s real estate facilities, which were then leased back to ManorCare, and taking a 10% equity stake in ManorCare.
The complaint alleges that throughout the Class Period, the defendants misrepresented or concealed from investors, that: (a) ManorCare was actively engaged in reimbursement billing fraud, in violation of federal and state laws; (b) as a result of ManorCare’s billing fraud, ManorCare’s reported revenue and earnings were false and ManorCare’s consolidated financial statements did not comply with GAAP; and (c) ManorCare’s billing fraud and the DOJ’s action against ManorCare put HCP’s lease revenue stream from ManorCare in jeopardy, and called into question the value of HCP’s ManorCare real estate assets and HCP’s equity stake in ManorCare.
On April 21, 2015, HCP disclosed that the United States Department of Justice (“DOJ”) had intervened in whistleblower lawsuits and filed a consolidated complaint. Following this news, HCP’s stock declined from close of $43.33 on April 20, 2015, to close of $42.85 on April 21, 2015.
Then, on May 5, 2015, HCP disclosed that it had recorded a non-cash impairment charge of $478 million related to certain of its lease arrangements with ManorCare, and stated that this impairment reduced the carrying value of HCP’s ManorCare assets from $6.6 billion to $6.1 billion. Following this news, HCP’s stock declined by 2.9% from $40.75 at close on May 4, 2015, to $39.55 at close on May 5, 2015.
Finally, on February 9, 2016, HCP disclosed that its equity stake in ManorCare had been written down to zero, and that it had taken an $836 million non-cash impairment on its ManorCare lease assets and placed all of its ManorCare real estate assets on a “Watch List.” Following this news, HCP’s stock declined by 17%, from close of $33.99 on February 8, 2016, to close of $28.33 on February 9, 2016.
If you are a member of the class described above, you may no later than July 11, 2016 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. For more information about Kessler Topaz Meltzer & Check, LLP, please visit our website at http://www.ktmc.com.
Kessler Topaz Meltzer & Check, LLP
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