Case Page

 

Case Status:    SETTLED
On or around 06/15/2016 (Date of order of distribution of settlement)

Filing Date: November 02, 2010

According to the complaint filed November 2, 2010, this is a securities fraud action brought under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule IOb-5 promulgated thereunder by the SEC by plaintiff on behalf of all those who purchased the publicly traded common stock of Gentiva during the Class Period to recover damages caused to the Class by defendants' violations of the securities laws. Throughout the Class Period, a material portion of the Company's reported net revenue was derived from reimbursements by Medicare. Respectively, in 2008 and 2009, 52% and 68% of Gentiva's reported net revenues came from Medicare.

Throughout the Class Period, Defendants reported growth in revenue and earnings that were, in large part, based on material increases in Medicare revenues and admissions in the Company's Home Health segment. But defendants failed to disclose that the Company improperly increased the number of in-home therapy visits to patients for the purpose of triggering higher reimbursement rates under the Medicare PPS. As a result of the Company's improper conduct, its reported sales and earnings were materially inflated and, based on the foregoing, defendants lacked a basis for their positive statements about the Company, its prospects and growth.

On May 13, 2010, the Wall Street Journal reported that the United States Senate Finance Committee launched an investigation into the practices of companies that provide in-home therapy visits reimbursed by Medicare, including Gentiva. During the Class Period, certain of the Company's top executives and/or directors sold approximately 531,279 Gentiva shares at artificially inflated prices for proceeds of approximately $12.8 million.

As summarized by the Company's FORM 10-Q for the quarterly period ended September 30, 2011, on January 21, 2011, the Minneapolis Police Relief Association (the “MPRA”) moved to intervene as a named plaintiff in the action and further requested that, to the extent its motion was granted, the Court appoint it lead plaintiff. On February 7, 2011, the defendants filed a limited objection to the motion to intervene and, on February 17, 2011, the MPRA responded. On July 19, 2011, the Court granted the MPRA’s motion to intervene as a named plaintiff, but denied, without prejudice, its request to be appointed lead plaintiff. On July 25, 2011, plaintiff Endress filed a motion seeking to withdraw as plaintiff, and the MPRA renewed its motion seeking to be appointed lead plaintiff.

On September 14, October 11, October 20 and October 25, 2011, four additional putative shareholder class action complaints, captioned Cement Masons & Plasterers Joint Pension Trust v. Gentiva Health Services, Inc. et al., Civil Action No. 11-CV-4433, International Union of Operating Engineers Pension Fund of Eastern Pennsylvania and Delaware v. Gentiva Health Services, Inc. et al., Civil Action No. 11-CV-4906, Arkansas Teacher Retirement System v. Gentiva Health Services, Inc. et al., Civil Action No. 11-CV-5126, and Douglas Dahlgard v. Gentiva Health Services, Inc. et al., Civil Action No. 11-CV-5199, respectively, were filed in the United States District Court for the Eastern District of New York. Like the Endress action, the Cement Masons, International Union, Arkansas Teacher, and Dahlgard actions name Gentiva and certain current and former officers as defendants, and assert claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 in connection with the Company’s participation in the Medicare HH PPS. The complaints allege that the Company’s public disclosures misrepresented and failed to disclose that the Company improperly increased the number of in-home therapy visits to patients for the purposes of triggering higher reimbursement rates under the HH PPS, which caused an artificial inflation in the price of Gentiva’s common stock during the period between July 31, 2008 and July 20, 2010 (Cement Masons), July 31, 2008 and September 30, 2011 (International Union and Arkansas Teacher), and July 31, 2008 and October 4, 2011 (Dahlgard).

On October 5, 2011, the Cement Masons & Plasterers Joint Pension Trust (“Cement Masons”) requested that the Court consolidate the Cement Masons action with the Endress action and further requested that the Court appoint Cement Masons lead plaintiff. On October 11, 2011, the International Union of Operating Engineers Pension Fund of Eastern Pennsylvania and Delaware (“International Union”) requested consolidation of the Cement Masons action and the International Union action with the Endress action and further requested that the Court appoint International Union lead plaintiff. On October 20, 2011, the Arkansas Teacher Retirement System (“Arkansas Teacher”) requested consolidation of the Cement Masons, International Union and Arkansas Teacher actions with the Endress action and further requested that the Court appoint Arkansas Teacher lead plaintiff. On October 27, 2011, Douglas Dahlgard (“Dahlgard”) requested consolidation of the Cement Masons, International Union, Arkansas Teacher and Dahlgard actions with the Endress action and further requested that the Court appoint Dahlgard lead plaintiff.

On November 2, 2011, the Court (i) granted plaintiff Endress’ motion to withdraw as plaintiff; (ii) ordered the consolidation of the Endress, Cement Masons, International Union, Arkansas Teacher and Dahlgard actions under the caption In re Gentiva Securities Litigation, Civil Action No. 10-CV-5064; and (iii) set a deadline of January 2, 2012 for all motions by any putative class member seeking to be appointed lead plaintiff.

On January 26, 2012, the Court issued an Order appointing lead plaintiff and approving the selection of lead counsel.

On April 16, 2012, plaintiffs filed an amended consolidated complaint.

On March 25, 2013, the Court issued an Order granting the Defendants' motion to dismiss. Plaintiffs were given leave to file an amended complaint. Plaintiffs filed their amended complaint on May 10.

On September 19, 2013, the Court issued an Order granting in part and denying in part the motion to dismiss of the defendants.

On March 3, 2014, the Court issued an Order granting in part and denying in part Plaintiffs' motion pursuant to Rule 54 of the Federal Rules of Civil Procedure. The motion was granted to the extent the Plaintiff seeks final judgment for the claims brought pursuant to the 1933 Act as to all the Defendants. The motion is denied to the extent the Plaintiff seeks final judgment for claims brought pursuant to the 1934 Act as to Gentiva and certain individual defendants.

COMPANY INFORMATION:

Sector: Healthcare
Industry: Healthcare Facilities
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: GTIV
Company Market: NASDAQ
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: E.D. New York
DOCKET #: 10-CV-05064
JUDGE: Hon. Arthur D. Spatt
DATE FILED: 11/02/2010
CLASS PERIOD START: 07/31/2008
CLASS PERIOD END: 07/20/2010
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Kaplan Fox & Kilsheimer, LLP (New York)
    850 Third Avenue, 14th Floor, Kaplan Fox & Kilsheimer, LLP (New York), NY 10022
    212.687.1980 212.687.1980 ·
No Document Title Filing Date
COURT: E.D. New York
DOCKET #: 10-CV-05064
JUDGE: Hon. Arthur D. Spatt
DATE FILED: 05/10/2013
CLASS PERIOD START: 07/31/2008
CLASS PERIOD END: 10/04/2011
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Kaplan Fox & Kilsheimer, LLP (New York)
    850 Third Avenue, 14th Floor, Kaplan Fox & Kilsheimer, LLP (New York), NY 10022
    212.687.1980 212.687.1980 ·
No Document Title Filing Date