According to the Complaint, Talkspace, Inc. is a behavioral healthcare company that markets itself as being enabled by a “purpose-built technology platform.”
On January 13, 2021, Hudson Executive Investment Corporation (“HEIC”) announced that it had entered into a merger agreement with Talkspace (the “Merger”).
The Complaint alleges that, in an attempt to secure shareholder support for the Merger, on May 28, 2021, Defendants issued a materially false and misleading Preliminary Proxy on Schedule 14A. The Proxy, which recommended that HEIC shareholders vote in favor of the Merger, allegedly misrepresented Talkspace’s business, financials, and prospects, by omitting, among other things, that: (i) Talkspace was experiencing significantly increased online advertising costs in its business-to-consumer (“B2C”) channel since the start of 2021; (ii) Talkspace was experiencing lower conversion rates in its online advertising in its B2C business; (iii) Talkspace was experiencing increased customer acquisition costs and more tepid B2C demand than represented to investors; (iv) Talkspace was suffering from ballooning customer acquisition costs and worsening growth and gross margin trends; (v) Talkspace had overvalued its accounts receivables from certain of its health plan clients in its business-to-business channel, which amounts required adjustment downward; and (vi) as a result of the foregoing, Talkspace’s 2021 financial guidance was not achievable and lacked any reasonable basis in fact. The Complaint further alleges that after the Merger closed the Proxy was revealed to be materially false and misleading, causing the price of Talkspace common stock to substantially decline and Talkspace investors to suffer damages under the Exchange Act.
On June 3, 2022, the Court issued an Order consolidating cases and appointing Co-Lead Plaintiffs and Counsel. All future docketing was ordered to be done in the lead case 22-CV-00163.
Co-Lead Plaintiffs filed a consolidated Complaint on August 1, 2022.
On May 19, 2023, the parties entered into a Stipulation of Settlement. The Court granted preliminary approval of the Settlement on June 30. On October 30, the Court granted final approval of the Settlement, including an award of Attorneys’ Fees and Expenses, and entered Final Judgment.