Amedisys, Inc. is a provider of home health services to the chronic, co-morbid, aging American population. The Company operates in two segments: home health and hospice segments.
According to a press release dated June 10, 2010, a class action lawsuit as been filed against Amedisys and certain of its top officials. The Complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act and Rule 10b-5 promulgated thereunder.
Specifically, the Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose material adverse facts about the Company's business, operations, and prospects. Specifically, the Complaint alleges that Defendants made false and/or misleading statements and/or failed to disclose: (1) that the Company's reported sales and earnings growth were materially impacted by a scheme whereby the Company intentionally increased the number of in-home therapy visits to patients for the purpose of triggering higher reimbursement rates under the Medicare home health prospective payment system, as those excess visits were not always medically necessary; (2) that the Company's reported sales and earnings were inflated by said scheme and subject to recoupment by Medicare; (3) that the Company was in material violation of its Code of Ethical Business Conduct and compliance due to the scheme to inflate Medicare revenues; and (4) based on the foregoing, Defendants lacked a basis for their positive statements about the Company, its prospects and growth.
On April 27, 2010, The Wall Street Journal ("WSJ") reported that Amedisys has been taking advantage of the Medicare reimbursement system by increasing the number of in-home therapy visits in order to trigger additional reimbursements. As reported in the article, according to a former Amedisys nurse, the excess visits that triggered additional reimbursements were "not always medically necessary." In the wake of this revelation, Amedisys securities fell $3.98 or 6.5%.
On May 13, 2010, the WSJ did a follow up article where it reported that the Senate Finance Committee ("Committee") had started an investigation into the billing and operating practices of Amedisys. In a Committee letter dated May 12, 2010 to Amedisys, the Committee cited the findings of the WSJ article and requested the Company to produce documents dating as far back as 2006, concerning data on therapy visits, lists of physicians with the highest patient referrals to the Company, and copies of all marketing materials. In the wake of this additional revelation, Amedisys securities fell nearly 8% or $4.48.
On August 26, 2010, Judge Brian A. Jackson granted the motion to consolidate eight related class action under lead case 10-CV-395.
According to the Ruling and Order signed by Judge Brian A. Jackson on October 22, 2010, Employees' Retirement System of Mississippi and Puerto Rico Teachers' Retirement System are appointed lead Plaintiff in the consolidated class action securities cases. Bernstein Litowitz Berger Grossman LLP and Wolf Popper LLP are appointed as lead Counsel. On November 12, 2010, Judge Jackson granted a motion to amend the order appointing liaison Counsel. Hymel Davis Petersen is appointed as liaison Counsel in the consolidated securities class actions.
On January 18, 2011, the lead Plaintiffs filed a Consolidated Securities Class Action Complaint. The Defendants responded by filing several motions to dismiss the Consolidated Securities Class Action Complaint in March 2011.
On June 28, 2012, the Court issued a Ruling and subsequent Order granting the Defendants' motions to dismiss. On April 9, 2013, the Court denied the Plaintiffs' motion for reconsideration of this Order. The Plaintiffs filed a Notice appealing these decisions on May 3.
On April 17, 2013, the Court issued an Order reopening this case.
On August 19, 2016, the Court issued an Order granting in part and denying in part Defendants' Motion to Dismiss.
On August 4, 2017, the parties entered into a Stipulation of Settlement. This Settlement was preliminarily approved on August 21. On December 19, the Court issued an Order awarding Attorneys' Fees and Reimbursement of Litigation Expenses. On December 20, the Court issued an Order approving the Plan of Allocation and entered Final Judgment. On January 28, 2019, the Court issued an Order approving the Distribution Plan.