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BOCA RATON, Fla., Aug. 08, 2019 (GLOBE NEWSWIRE) -- Saxena White P.A. has filed a securities fraud class action lawsuit in the United States District Court for the Eastern District of Virginia against Evolent Health, Inc. (“Evolent” or the “Company”) (NYSE: EVH) on behalf of all persons or entities who purchased or otherwise acquired Evolent common stock between March 3, 2017 and May 28, 2019, inclusive (the “Class Period”).
If you purchased Evolent common stock during the Class Period and wish to apply to be lead plaintiff, a motion on your behalf must be filed with the Court by no later than October 7, 2019. You may contact David Kaplan (firstname.lastname@example.org), an attorney and Director at Saxena White P.A., to discuss your rights regarding the appointment of lead plaintiff or your interest in the class action. You may also retain counsel of your choice and need not take any action at this time to be a class member.
Evolent provides health care delivery and payment services to a national network of health systems across Medicare, Medicaid and commercial markets. By the end of 2018, Evolent had contractual relationships with over 35 operating partners. Many of these “partners” were either related parties, or companies in which Evolent had significant ownership or had provided financing at the onset of the relationship. Evolent’s largest and most important partner was University Health Care, Inc., d/b/a Passport Health Plan (“Passport”), which represented 20% of the Company’s revenues.
The Complaint asserts claims for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 against Evolent and certain of its senior executives (“Defendants”). The action alleges that during the Class Period, Defendants issued a series of false and/or misleading statements and failed to disclose material adverse facts about Evolent’s business, operations, and prospects, including Evolent’s “partnership” with Passport specifically. Among other things, Defendants mispresented and failed to disclose that: (1) Evolent’s partnership model did not align the Company’s interests with those of its partners, as the model was designed to inflate the Company’s revenue by extracting enormous administrative and management fees at the expense of its operating partners such as Passport; (2) Passport was struggling financially, particularly after Kentucky cut its reimbursement rates, and the partnership between Evolent and Passport was becoming increasingly unsustainable; (3) Evolent was draining Passport of functions, employees and money, to such an extent that Passport was left on the verge of insolvency; (4) Passport was conducting a bidding process for several months to sell itself to prevent liquidation; and (5) as a result of the foregoing, Defendants’ public statements were materially false and/or misleading and/or lacked a reasonable basis.
Ultimately, on May 29, 2019, Evolent shocked investors when it unexpectedly announced that it was buying a controlling interest in Passport, which was essentially a bailout of the financially distressed health plan. Evolent acquired Passport despite previously stating that it had no intention of buying Passport or any other health plans for the foreseeable future, and that acquiring health plans was not part of its strategic focus. In addition, Evolent admitted that Passport was performing poorly and was not being run or managed properly, despite paying massive management fees to Evolent for what was previously understood by investors to be an aligned relationship. In reaction to these disclosures, Evolent’s stock price plummeted nearly 30%.
You may obtain a copy of the Complaint and inquire about actively joining the class action at www.saxenawhite.com.
Saxena White P.A., with offices in Florida, New York, and California, concentrates its practice on prosecuting securities fraud and complex class actions on behalf of institutions and individuals. Currently serving as lead counsel in numerous securities fraud class actions nationwide, the firm has recovered hundreds of millions of dollars on behalf of injured investors and is active in major litigation pending in federal and state courts throughout the United States.