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InnovAge Holding Corp.

Case Details

Class Period: March 2, 2021 - October 14, 2021
Date Filed: October 14, 2021
Case Number: 1:21cv02770
Jurisdiction: Colorado District Court
icon-casetype Case Type: Securities Case
Days Left to
Seek Plaintiff:
6

Case Summary

In March 2021, InnovAge completed its IPO, selling approximately 18,995,901 shares of common stock at a price of $21.00 per share. On September 21, 2021, after the market closed, InnovAge revealed that the Centers for Medicare and Medicaid Services (“CMS”) had “determined to freeze new enrollments at [the Company’s] Sacramento center based on deficiencies detected in [a recent] audit.” It stated that these “deficiencies relate to failures to provide covered services, provide accessible and adequate services, manage participants medical situations, and oversee use of specialists, among others.” On this news, the Company’s stock price fell $2.90 per share, or 25%, to close at $8.75 per share on September 22, 2021, on unusually heavy trading volume. By the commencement of this action, the Company’s stock was trading as low as $6.61 per share, a nearly 69% decline from the $21 per share IPO price. The complaint filed in this class action alleges that Defendants failed to disclose to investors: (1) that certain of InnovAge’s facilities failed to provide covered services, provide accessible and adequate services, manage participants’ medical situations, and oversee use of specialists; (2) that, as a result, the Company was reasonably likely to be subject to regulatory scrutiny, including by the Centers for Medicare and Medicaid Services; (3) that, as a result, there as a significant risk that CMS would suspend new enrollments pending an audit of the Company’s services; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.

Documents
Complaint
10/14/2021