Chemed Corporation Hit By Investor Class Action Lawsuit Over Alleged Securities Laws Violations
San Diego, Jan. 12, 2012 (Shareholders Foundation) -- An investor in NYSE: CHE shares filed a lawsuit in the U.S. District Court for the Southern District of Ohio against Chemed Corporation over alleged Violations of Federal Securities Laws.
According to the complaint the plaintiff alleged on behalf of purchasers of Chemed Corp. (NYSE: CHE) common stock during the period between February 15, 2010 and November 16, 2011, that Chemed Corporation and certain of its officers and directors violated the Securities Exchange Act of 1934 by issunging materially false and misleading statements regarding the Company's business and prospects.
Chemed Corporation reported that its annual Revenue rose from $1.1billion in 2007 to $1.28billion in 2010 and its Net Income increased from $61.64million for ’07 to $81.83million in 2010.
Shares of Chemed Corporation (Public, NYSE:CHE) rose from as low as $35.30 in March ’09 to over $71 per share in may 2011.
Then on November 16, 2011, a media outlet reported that Vitas Healthcare Corp., a unit of Chemed Corp., has been accused by a whistleblower in lawsuit of a medicare HMO conspiracy. Additionally, the Department of Justice (“DOJ”) reportedly is seeking internal Vitas Healthcare Corp documents in an investigation focused on alleged abuses of Federal health-insurance programs. According to the article “the government has told the court it suspects Vitas of ‘an extensive scheme’ to defraud Medicare and Medicaid of ‘hundreds of millions of dollars’ by falsifying records and hospice certifications.”
Following the report shares of Chemed Corporation (Public, NYSE:CHE) fell from $57.52 on Nov. 15, 2011 to as low as $48.43 on November 16, 2011 and closed on Friday, Nov. 18 at $49.77.