Kessler Topaz Meltzer & Check, LLP Reminds Clover Health Investments, Corp. Investors of Deadline in Securities Fraud Class Action Lawsuit
RADNOR, Pa., March 24, 2021 (GLOBE NEWSWIRE) – Law firm Kessler Topaz Meltzer & Check, LLP reminds investors of Clover Health Investments, Corp. (NASDAQ: CLOV) (“Clover”) in a class action lawsuit for securities fraud. A lawsuit has been filed against Clover in the US District Court for the Middle District of Tennessee on behalf of those who have bought or acquired publicly traded Clover securities between October 6, 2020 and February 4, 2021 inclusive (the “Class Period”) and / or any Clover securities purchased or acquired in accordance with the registration statement and prospectus of Clover issued in connection with the December 2020 merger or traceable.
Deadline of the main plaintiff: April 6, 2021
According to the complaint, Clover offers health insurance benefits. Clover was floated on the stock exchange through a reverse merger with IPOC, a Special Purpose Acquisition Company (the “Business Combination”). Prior to the business combination, IPOC was listed on the New York Stock Exchange. The class period begins on October 6, 2020 when Clover issued a press release announcing its intention to become a public company through a merger with IPOC. On October 20, 2020, Clover filed its registration statement and preliminary proxy statement / prospectus on a Form S-4 with the SEC (the “Registration Statement”). The registration declaration was changed on December 9, 2020 and December 10, 2020 and declared effective on December 11, 2020. The registration statement touted Clover’s growth as strong and organic.
On February 4, 2021, ahead of market hours, Hindenburg Research released a research report showing that Clover’s flagship platform, Clover Assistant, has been the subject of a U.S. Department of Justice (DOJ) investigation on various topics, including illegal setbacks, marketing practices and not Disclosed Related Party Transactions. Hindenburg found that Clover’s sales growth was not being driven by technology, but rather by misleading sales practices. Following this news, Clover Common Stock (CLOV) fell $ 1.72 per share, or 12.3%, to $ 12.23 per share on February 4, 2021, and Clover Warrants (CLOVW) fell $ 0.18 per warrant or 5% to $ 3.39 per warrant on February 4, 2021.
On February 5, 2021, before the market opened, Clover filed a Form 8-K stating that for the period January 1, 2020 to date, the SEC was “investigating and requesting the retention of documents and data in Regarding Certain Matters ”as referred to in the [Hindenburg Research report]. Following this news, Clover Common Stock (CLOV) fell $ 0.53 per share, or 4.3% during intraday trading on February 5, 2021, and Clover Warrants (CLOVW) fell on February 5, 2021 $ 0.28 per warrant or 8.2% during intraday trading.
The complaint alleges that throughout the classroom, the defendants made false and / or misleading statements and / or failed to disclose that: (1) Clover from the DOJ on at least 12 questions ranging from illegal kickbacks to marketing practices; actively investigated undisclosed related party transactions; (2) The DOJ’s investigation posed an existential risk to Clover as it derives most of its revenues from Medicare. (3) Clover’s sales were driven by an important, undisclosed related party deal and misleading marketing to the elderly, not alleged “best-in-class” technology. (4) A significant portion of Clover sales came from an undisclosed relationship between Clover and a brokerage firm controlled by Clover’s sales director. and (5) as a result, Defendants’ statements about their business, operations and prospects were materially false and misleading and / or were unfounded.
Klee investors can no later than April 6, 2021, attempt to be appointed plaintiff’s principal representative of the class by Kessler Topaz Meltzer & Check, LLP, or other lawyer, or choose to do nothing and remain an absent class member. A lead plaintiff is a representative party who acts on behalf of all class members in directing the dispute. To be named lead plaintiff, the court must determine that the class member’s claim is typical of the claims of other class members and that the class member is adequately representing the class. Your ability to get involved in a recovery will not be affected by whether or not you will be the lead plaintiff.
Kessler Topaz Meltzer & Check, LLP, pursues class action lawsuits in state and federal courts across the country involving securities fraud, fiduciary violations, and other violations of federal and state law. Kessler Topaz Meltzer & Check, LLP, is a driving force behind corporate governance reform and has reclaimed billions of dollars on behalf of institutional and individual investors from the US and around the world. The company represents investors, consumers and whistleblowers (individuals who report fraudulent practices against the government and are involved in recovering government dollars). The complaint in this lawsuit was not filed by Kessler Topaz Meltzer & Check, LLP. For more information on Kessler Topaz Meltzer & Check, LLP, please visit www.ktmc.com.
Kessler Topaz Meltzer & Check, LLP
James Maro Jr., Esq.
Adrienne Bell, Esq.
280 Street of the King of Prussia
Radnor, PA 19087
(844) 887-9500 (toll free)