The original Complaint alleges that Centene, a healthcare enterprise, and certain of its officers and directors violated federal securities laws by issuing a series of materially false statements. Specifically, defendants assured investors that its costs were under control, and that the only market where there was any concern related to pharmacy costs was Indiana and to a limited degree Ohio. The defendants reported that cost trends were improving in Indiana and Ohio. In June 2006, defendants reaffirmed that there were no surprises. Thereafter in late June 2006, Goldman Sachs announced that based on its discussions with Centene, its management had strong confidence in its guidance for the second quarter of 2006 and for the remainder of 2006, and that cost trend issues remained manageable. The complaint further alleges that on or around July 18, 2006, defendants announced that 2006 second quarter results would be far below prior guidance, and that results for the remainder of 2006 would not meet guidance. The huge shortfall was caused by additional medical costs incurred in Indiana and Texas. On this news, Centene shares dropped from $21.04 to $13.44.
On November 2, 2006, the Court entered the Order signed by U.S. District Judge Catherine D. Perry granting the motion to consolidate the two related securities class action under 4:06CV1142. On November 17, 2006, the Court entered the Order granting the motion to appoint lead plaintiff and approve his selection of lead and liaison counsel. The plaintiffs shall filed a consolidated amended complaint on or before January 17, 2007. On January 17, 2007, a Consolidated Amended Class Action Complaint was filed, and on February 16, 2007, the defendants responded by filing a Joint Motion to Dismiss The Consolidated Amended Class Action Complaint. On June 29, 2007, the motion to dismiss was granted and the case was dismissed. On July 27, 2007, the plaintiff filed a Notice of Appeal in the Eighth Circuit Court of Appeals.
On October 16, 2008, the District Court entered the Opinion from the U.S. Court of Appeals for the Eighth Circuit. According to the Opinion and Judgment, the judgment of the district court in this cause is affirmed.