SAN DIEGO & ARLINGTON, Va.--(BUSINESS WIRE)--Shareholder rights law firm Robbins Arroyo LLP announces that a purchaser of Evolent Health, Inc. (NYSE: EVH) filed a class action complaint for alleged violations of the Securities Exchange Act of 1934 between March 3, 2017 and May 28, 2019. Evolent Health provides health care delivery and payment solutions.
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Evolent Health, Inc. (EVH) Accused of Misleading Shareholders
According to the complaint, Evolent touted a "land and expand" business model that increased revenues by securing health plan clients that were in impaired financial condition and offering them loans, equity investments, and other extensions of capital. Throughout the relevant period, Evolent assured investors that its strategy was to service health plans rather than own them, which would limit its financial exposure and avoid the political and financial risks faced by health plans. However, Evolent failed to disclose that its services extracted ever increasing fees from its clients, severely deteriorating their financial conditions. Then, on May 29, 2019, Evolent revealed that contrary to its business strategy, it would purchase a controlling interest in Passport, its largest client. Evolent disclosed that Passport was performing poorly due to inadequate management, despite the large management fees Passport was paying to Evolent. On this news, Evolent's stock price plummeted 30% and has since continued to decline, currently trading at $7.11, a 75% decline from its class period high of $28.75.
Evolent Health, Inc. (EVH) Shareholders Have Legal Options
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