Healthcare Services Group, Inc. (NASDAQ: HCSG) Investor Securities Class Action Lawsuit 03/22/2019

If you purchased a significant amount of shares of Healthcare Services Group, Inc. (NASDAQ: HCSG) between April 11, 2017 and March 4, 2019, and / or if you purchased any NASDAQ: HCSG shares prior to April 2017 and continue to hold any of those shares, you have certain options and for certain investors are short and strict deadlines running. Deadline: May 21, 2019. NASDAQ: HCSG investors should contact the Shareholders Foundation, Inc.

To have your information reviewed for options and to recieve notifications about this case, please use this form. You may also send an email to mail@shareholdersfoundation.com, or call us at (858) 779-1554.
Company Name(s): 
Healthcare Services Group
Case Name: 
Healthcare Services Group Shareholder Class Action Lawsuit 03/22/2019
Case Status: 
Lawsuit Filed
Affected Securities
NASDAQ: HCSG
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
03/22/2019
Class Period Begin: 
04/11/2017
Class Period End: 
03/04/2019
Court of Filing: 
U.S. District Court for the Eastern District of Pennsylvania
Deadline To File for Lead: 
05/21/2019
Summary: 

An investor in shares of Healthcare Services Group, Inc. (NASDAQ: HCSG) filed a lawsuit in the U.S. District Court for the Eastern District of Pennsylvania over alleged violations of Federal Securities Laws by Healthcare Services Group, Inc. in connection with certain allegedly false and misleading statements made between April 11, 2017 and March 4, 2019.

On March 4, 2019, in a Form filed with the Securities and Exchange Commission (“SEC”), Healthcare Services Group, Inc disclosed that it had received a letter in November 2017 from the SEC regarding an inquiry that the SEC was conducting into EPS calculation practices and requesting that the Company voluntarily provide certain information and documents relating to its EPS rounding and reporting practices. The March 4, 2019 Form further disclosed that Healthcare Services Group, Inc also had received a subpoena in March 2018 from the SEC in connection with these matters and that it had been providing information and documents to the SEC.
The March 4, 2019 Form also revealed to investors that, during the fourth quarter of 2018, Healthcare Services Group, Inc authorized its outside counsel to conduct an internal investigation, under the direction of the Company’s Audit Committee, into matters related to the SEC subpoena. The Form acknowledged that, as a result of these circumstances, the Company was unable to file its Annual Report on Form for the year ended December 31, 2018 on time.
Then, on March 4, 2019, An article was published entitled ‘Strategic Rounding’ At Healthcare Services Group: A Subpoena From The SEC And An Internal Investigation (the “March 2019 Article”). The March 2019 Article referred back to a prior article published by Monocle in March 2017—the allegations of which Healthcare Services categorically denied following its publication—claiming, in pertinent part: “[I]t appeared that the company had been actively engaging FOR OVER A DECADE in aggressive accounting by fiddling with its revenues and/or expenses in order to ensure that its earnings per share rounded up to the nearest penny every quarter. This helped enable the company to meet or beat the consensus sell-side earnings expectation most quarters, which in turn helped the company achieve premium earnings multiple for the stock. Arguably, this allowed founder and Chairman Daniel McCartney to personally realize millions of dollars more for the stock that he sold to the public than he otherwise would have.”
Additionally, according to the March 2019 Article, Healthcare Services “dramatically amend[ed]” the way it managed its quarterly EPS following Monocle’s publication of the March 2017 Article, as well as after Monocle informed the Company, the Company’s sell-side analysts, and the SEC of its findings. The March 2019 article also noted how Healthcare Services’ EPS continued to climb dramatically in the wake of Monocle’s release of the 2017 article.

According to the complaint the plaintiff alleges on behalf of purchasers of Healthcare Services Group, Inc. (NASDAQ: HCSG) common shares between April 11, 2017 and March 4, 2019, that the defendants violated Federal Securities Laws.

More specifically, the plaintiff claims that between April 11, 2017 and March 4, 2019, the Defendants made false and/or misleading statements and/or failed to disclose that Defendants made false and misleading statements and engaged in a scheme to deceive the market and a course of conduct that artificially inflated the price of Healthcare Services securities and operated as a fraud or deceit on purchasers of Healthcare Services securities between April 11, 2017 and March 4, 2019 by misrepresenting the value of the Company’s business and prospects by overstating its earnings and concealing the significant defects in its internal controls