Patriot National Inc (NYSE: PN) Investor Securities Class Action Lawsuit 03/14/2017

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Company Name(s): 
Patriot National
Case Name: 
Patriot National Shareholder Class Action Lawsuit 03/14/2017
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Proposed
Affected Securities
NYSE: PN
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
03/14/2017
Class Period Begin: 
08/15/2016
Class Period End: 
03/03/2017
Court of Filing: 
U.S. District Court for the Southern District of New York
Deadline To File for Lead: 
05/15/2017
Date Settled: 
07/22/2019
Settlement Amount: 
$6,500,000
Deadline to Participate in Settlement: 
12/17/2019
Summary: 

July 22, 2019 - The court preliminarily approved the settlement.

December 21, 2018 - Parties filed a stipulation of settlement.

October 12, 2017 - All cases were consolidated.

May 15, 2017 - Lead plaintiff motions were filed.

March 14, 2017 - An investor in shares of Patriot National Inc (NYSE: PN) filed a lawsuit in the U.S. District Court for the Southern District of New York over alleged violations of Federal Securities Laws by Patriot National Inc in connection with certain allegedly false and misleading statements made between August 15, 2016 and March 3, 2017.

According to the complaint the plaintiff alleges on behalf of purchasers of Patriot National Inc (NYSE: PN) common shares between August 15, 2016 and March 3, 2017, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between August 15, 2016 and March 3, 2017, the defendants failed to disclose that the Patriot National Inc special committee was beholden to Mariano, that, as such, the special committee was operating for the benefit of Mariano, and not the Company or its shareholders, that the special committee did not independently assess the merits of the Ebix transaction, that the special committee was not exploring strategic alternatives in order to maximize shareholder value, and that, as a result of the foregoing, defendants’ statements about Patriot National Inc’s business, operations, and prospects, were false and misleading and/or lacked a reasonable basis.

Fort Lauderdale, FL based Patriot National Inc is an independent national provider of technology-enabled outsourcing solutions that help insurance carriers, employers and other clients mitigate risk and comply with complex regulations.

Patriot National Inc reported that its annual Total Revenue rose from $117.26 million in 2014 to $209.72 million in 2015 and that its Net Income of $10.41 million declined to a Net loss of $5.38 million in 2015.

In December 2016 it was reported that a Patriot National Inc shareholder sued Patriot National Inc in Delaware based on allegations that the CEO of Patriot National Inc Mr. Steve Mariano had been using the company “as his personal piggy bank” and that Mariano made a series of decisions that were detrimental to the Company’s business, but that allowed him to retain control of the Company.

On March 3, 2017, Patriot National Inc announced that it had entered into an agreement with Guarantee Insurance Group and Mariano, regarding the service agreements between Patriot National Inc and Guarantee Insurance Group’s wholly-owned subsidiary Guarantee Insurance Company.

Mr. Mariano is both the Chairman, CEO, and majority owner of Patriot National Inc, as well as the majority owner of Guarantee Insurance Company. Patriot National Inc further disclosed that Guarantee Insurance Company is the Company’s principal customer, with contracts and relationships from Guarantee Insurance Company generating $107.8 million, or 59% of the Company’s Total Fee Income and Fee Income from Related Party for the nine-months ended September 30, 2016.