A class action lawsuit has been filed in the United States District Court for the Southern District of Ohio on behalf of purchasers of Chemed Corporation (NYSE:CHE) common stock during the period between February 15, 2010 and November 16, 2011 (the “Class Period”).
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and prospects. Specifically, defendants misrepresented and/or failed to disclose the following adverse facts: (a) that the Company engaged in a scheme to fraudulently bill Medicare for hospice services for patients who did not qualify for hospice and fraudulently shifted the costs of those patients from health maintenance organizations that covered those patients prior to enrollment in hospice to the U.S. government; (b) that a significant portion of the Company’s hospice enrollments, revenues and earnings were the direct result of defendants’ scheme to enroll ineligible patients in hospice and fraudulently bill Medicare for hospice services; (c) that, in a complaint filed under seal, a former VITAS manager had accused the Company of engaging in a Company-wide scheme to enroll ineligible patients in hospice and fraudulently bill Medicare; (d) that the Company failed to maintain adequate internal controls and procedures with respect to hospice enrollments and Medicare billings; (e) that the Company’s financial results were materially overstated as a result of defendants’ fraudulent scheme to enroll ineligible patients in hospice; and (f) that, as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about the Company and its prospects.
On November 16, 2011, a Bloomberg article entitled “Whistleblower Accuses Chemed Unit of Medicare HMO Conspiracy” disclosed that a former VITAS manager had accused Chemed of defrauding the federal government by conspiring with health insurers to enroll Medicare patients who were not dying into hospice. The article also discussed a U.S. Department of Justice investigation into fraudulent conduct by VITAS. In response to these announcements, shares of the Company’s stock fell $6.87 per share, or 11%, to close at $50.65 per share on November 16, 2011.
If you are a current shareholder and/or purchased stock between February 15, 2010 and November 16, 2011, and would like to discuss your options of exercising your rights as a shareholder, please contact us.
Please submit the following information so we can determine if you qualify for the suit. If you don't know all the specific details, partial information is also acceptable.