NEW YORK, April 26, 2012 /PRNewswire/ -- Bernstein Liebhard LLP today announced that a securities class action has been commenced in the United States District Court for the Northern District of Illinois on behalf of purchasers (the "Class") of Accretive Health, Inc. ("Accretive Health" or the "Company") (Nasdaq: AH) common stock between March 2, 2011 and April 24, 2012 (the "Class Period").
The complaint charges Accretive Health and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Accretive Health provides revenue cycle management services for hospitals and healthcare providers in the United States.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and prospects. Specifically, the Company failed to disclose that it was violating health privacy laws, state debt collection laws and state consumer protection laws. As a result of defendants' false statements, Accretive Health's stock traded at artificially inflated prices during the Class Period, reaching a high of $30.80 per share on August 1, 2011.
On March 29, 2012, Accretive Health announced that in response to a lawsuit filed by Minnesota's Attorney General, the Company had agreed to no longer collect debts on behalf of Fairview Health Services ("Fairview") and would transition management of those operations to Fairview. Accretive Health further announced that it expected this change to negatively impact its fiscal year 2012 revenue by $62 million to $68 million. Then, on April 24, 2012, the Minnesota Attorney General released a report which highlighted aggressive practices used by Accretive Health, including demanding payment from people seeking care in emergency rooms, cancer wards and delivery rooms. As a result of this news, Accretive Health's stock plummeted $7.63 per share to close at $10.86 per share on April 25, 2012, a one-day decline of 41%.
According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows: (a) the Company was violating privacy standards under the Health Insurance Portability and Accountability Act and the Health Information Technology for Economic and Clinical Health Act by, among other things, (i) failing to provide appropriate safeguards to prevent the misuse or disclosure of protected health information; (ii) failing to keep all protected health information strictly confidential; and (iii) failing to develop, implement, maintain and use appropriate technical and physical safeguards to preserve the integrity, confidentiality and availability of protected health information and to prevent non-permitted use or disclosure of the information; (b) the Company failed to encrypt protected patient health information; (c) the Company was violating the terms of its contract with Fairview by failing to limit access of protected health information to the persons or classes of persons in its workforce who needed access to it in order to carry out their duties; (d) the Company was violating Minnesota state debt collection laws by, among other things, failing to provide patients with required disclosures identifying itself as a debt collection agency; (e) the Company was violating Minnesota consumer protection laws by, among other things, failing to disclose to patients the extent of the Company's access to data and the manner in which it utilizes such data; and (f) the effect the Company's violations of health privacy laws, state debt collection laws and state consumer protection laws would have on its future earnings and on its relationship with Fairview.
Plaintiffs seek to recover damages on behalf of all Class members who purchased or otherwise acquired Accretive Health common stock during the Class Period. If you purchased or otherwise acquired Accretive Health common stock during the Class Period, and either lost money on the transaction or still hold the shares, you may wish to join in this action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than June 25, 2012.
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. Under certain circumstances, one or more class members may together serve as lead plaintiff. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Bernstein Liebhard LLP, or other counsel of your choice, to serve as your counsel in this action.
If you are interested in discussing your rights as an Accretive Health shareholder and/or have information relating to the matter, please contact Joseph R. Seidman, Jr. at (877) 779-1414 or [email protected].
Bernstein Liebhard LLP has pursued hundreds of securities, consumer and shareholder rights cases and recovered over $3 billion for its clients. It has been named to The National Law Journal's "Plaintiffs' Hot List" in each of the last nine years.
You can obtain a copy of the complaint from the clerk of the court for the United States District Court for the Northern District of Illinois.
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SOURCE Bernstein Liebhard LLP