Robbins Russell Wins Dismissal Of $891 Million Securities Class Action
June 16, 2016
On June 16, 2016, the U.S. District Court for the Middle District of Tennessee dismissed a securities class action against firm client Community Health Systems in Norfolk County Retirement System v. Community Health System, Inc., No. 11-cv-433 (M.D. Tenn.). Lead Plaintiff alleged that a portion of CHS’s revenues, over a five-year period, had been derived from unnecessary inpatient admissions contrary to the company’s attribution of its success to legitimate business practices). Lead Plaintiff claimed “monetary damages exceeding $891,000,000.”
Chief Judge Sharp dismissed Lead Plaintiff’s complaint with prejudice in its entirety. The Court held that Lead Plaintiff failed to allege loss causation, because its alleged “corrective disclosure” was premised on a mere public allegation of fraud, and not any finding or disclosure that any fraud had actually occurred. The Court also held that certain of Lead Plaintiff’s claims were time-barred or failed to identify any material misstatement.
The Robbins Russell litigation team was headed by Gary Orseck, Michael Waldman, Alison Barnes, and Matthew Madden. Gary argued the successful motion to dismiss, joined on the briefs by other Robbins Russell attorneys.
Read the brief here.