Congressman Frank Pallone (D-N.J.) announced an investigation into companies that sell short-term “junk” health insurance plans
NEW YORK, March 14, 2019 (GLOBE NEWSWIRE) -- Wolf Haldenstein Adler Freeman & Herz LLP announces that a federal securities class action lawsuit has been filed in the United States District Court for the Middle District of Florida on behalf of all persons or entities who purchased or otherwise acquired Health Insurance Innovations, Inc. (the “Company” or “HIIQ”) (HIIQ) securities between February 28, 2018 and November 27, 2018 (the “Class Period”), inclusive.
Investors who have purchased shares of Health Insurance Innovations, Inc. are urged to contact the firm immediately at firstname.lastname@example.org or (800) 575-0735 or (212) 545-4774. You may obtain additional information concerning the action on our website, www.whafh.com.
If you have incurred losses in the shares, you may, no later than April 22, 2019, request that the Court appoint you lead plaintiff of the proposed class. Please contact Wolf Haldenstein to learn more about your rights as an investor in Health Insurance Innovations, Inc.
The filed complaint alleges that throughout the class period made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and prospects. Specifically, the complaint alleges that defendants failed to disclose to investors:
- that a substantial portion of the company’s revenues were derived from third parties;
- that these third parties used deceptive tactics to sell the company’s policies, including overstating the policy’s coverage and/or selling under the licenses of employees who had no involvement in the underlying sales;
- that regulatory scrutiny of these third parties would materially impact the company’s operations; and
- 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.
On November 2, 2018, HIIQ announced that it had immediately suspended its relationship with Health Benefits One LLC ("HBO"), an entity which the Federal Trade Commission ("FTC") alleged had misleadingly sold HIIQ policies, among others, as "comprehensive health insurance." HIIQ additionally stated that, for the 2018 fiscal year to date, HBO "was the agency of record for less than 10% of HIIQ's submitted policies."
On this news, HIIQ's stock price fell $4.47 per share, more than 8%, to close at $46.27 per share on November 2, 2018. HIIQ's stock price continued to decline over the next trading session to close at $39.62 per share on November 5, 2018.
Then, on November 27, 2018, Aurelius Value published a report entitled "HIIQ: Boiler Rooms, 'Worthless' Policies, and Defrauded Families," alleging, among other things, that more than half of the Company's revenues were derived from boiler room operations that had recently been shut down by the FTC and that a "material portion" of the Company's policies were likely "contaminated by insurance fraud."
Following this news, HIIQ's stock price fell $1.93, or nearly 6%, to close at $31.20 per share on November 27, 2018.
Subsequent to the end of the class period, on March 13, 2019, the stock fell over 17%, closing at $31.77, after the House of Representatives’ Energy and Commerce Committee Chairman Frank Pallone (D-N.J.) announced an investigation into companies that sell short-term “junk” health insurance plans, and which he argues are misleading consumers.
Wolf Haldenstein Adler Freeman & Herz LLP has extensive experience in the prosecution of securities class actions and derivative litigation in state and federal trial and appellate courts across the country. The firm has attorneys in various practice areas; and offices in New York, Chicago and San Diego. The reputation and expertise of this firm in shareholder and other class litigation has been repeatedly recognized by the courts, which have appointed it to major positions in complex securities multi-district and consolidated litigation.
If you wish to discuss this action or have any questions regarding your rights and interests in this case, please immediately contact Wolf Haldenstein by telephone at (800) 575-0735, via e-mail at email@example.com, or visit our website at www.whafh.com.
Wolf Haldenstein Adler Freeman & Herz LLP
Kevin Cooper, Esq.
Gregory Stone, Director of Case and Financial Analysis
Email: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org
Tel: (800) 575-0735 or (212) 545-4774
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