RADNOR, Pa.--(BUSINESS WIRE)--The law firm of Kessler Topaz Meltzer & Check, LLP announces that a shareholder class action lawsuit has been filed against DaVita Inc. (NYSE: DVA) (“DaVita” or the “Company”) on behalf of purchasers of the Company’s securities between August 5, 2015 and October 21, 2016, inclusive (the “Class Period”).
DaVita shareholders who purchased their securities during the Class Period may, no later than April 3, 2017, petition the Court to be appointed as a lead plaintiff representative of the class.
Shareholders who wish to discuss this action or request additional information about the lawsuit are encouraged to contact Kessler Topaz Meltzer & Check attorneys D. Seamus Kaskela or Adrienne O. Bell at (888) 299-7706 or online at: https://www.ktmc.com/new-cases/davita-inc#join
DaVita provides kidney dialysis services for patients suffering from chronic kidney failure or end-stage renal disease. At relevant times, DaVita made contributions to the American Kidney Fund (“AKF”), a purported charitable foundation that provides financial assistance toward patients’ health insurance premiums.
The shareholder class action complaint alleges that DaVita and certain of its executive officers made a series of materially false and misleading statements and/or failed to disclose material adverse facts about the Company’s business, operations, and prospects to investors during the Class Period, including the following: (1) that the Company and its senior executives purposefully steered patients into unnecessary insurance plans in order to maximize profits; (2) that the Company was using AKF as a vehicle to facilitate these improper practices; (3) that, as a result, DaVita’s revenues and profits were illegally obtained; and (4) that DaVita lacked effective internal controls over financial reporting. The complaint further alleges that, as a result of the foregoing, the defendants’ statements about DaVita’s business, operations, and prospects were false and misleading and/or lacked a reasonable basis.
On August 18, 2016, The Centers for Medicare & Medicaid Services issued a public request for information regarding the alleged steering of Medicare and Medicaid beneficiaries into other plans in order to earn higher reimbursement rates. Following this news, shares of the Company’s stock declined $3.17 per share, or 4.7%, to close on August 19, 2016 at $64.48 per share.
Then, on October 23, 2016, the St. Louis Post published an article entitled “DaVita encouraged some low-income patients to enroll in commercial plans” which directly accused DaVita of steering clients to private insurers and utilizing its own money to pay for health insurance premiums through the AKF. Following this news, shares of the Company’s stock declined an additional $2.86 per share, or 4.7%, to close on October 24, 2016 at $58.10 per share.
Subsequently, on January 6, 2017, The Wall Street Journal reported that investigators from the U.S. Department of Justice “are probing a controversial arrangement under which kidney-care companies support charitable efforts to help patients pay health-insurance premiums, according to disclosures from major dialysis providers.” Additionally, the article reported that the “Boston U.S. attorney’s office has subpoenaed DaVita Inc. … seeking ‘the production of information related to charitable premium assistance.’”
DaVita shareholders may, no later than April 3, 2017, petition the Court to be appointed as a lead plaintiff representative of the class through Kessler Topaz Meltzer & Check or other counsel, or may choose to do nothing and remain an absent class member. A lead plaintiff is a representative party who acts on behalf of all class members in directing the litigation. In order to be appointed as a 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 in the action. Your ability to share in any recovery is not affected by the decision of whether or not to serve as a lead plaintiff. For additional information, or to learn how to participate in this action, please visit https://www.ktmc.com/new-cases/davita-inc#join
Kessler Topaz Meltzer & Check prosecutes class actions in state and federal courts throughout the country. Kessler Topaz Meltzer & Check is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world. The firm represents investors, consumers and whistleblowers (private citizens who report fraudulent practices against the government and share in the recovery of government dollars). The complaint in this action was not filed by Kessler Topaz Meltzer & Check. For more information about Kessler Topaz Meltzer & Check, please visit www.ktmc.com.