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Investors with over $720 in losses are encouraged to contact the firm before June 7, 2021; click here to submit trade information
LOS ANGELES, June 06, 2021 (GLOBE NEWSWIRE) -- The Portnoy Law Firm advises investors that a class action lawsuit has been filed on behalf of MultiPlan Corporation (NYSE: MPLN) investors that acquired shares between July 12, 2020 and November 10, 2020. Investors have until June 7, 2021 to seek an active role in this litigation.
It is alleged in this complaint that MultiPlan made misleading and/or false statements and/or failed to disclose that: (1) MultiPlan was losing tens of millions of dollars in revenues and sales to Naviguard, a competitor that had been created by one of MultiPlan’s largest customers, UnitedHealthcare, which threatening up to 35% of MultiPlan’s sales and 80% of its levered cash flows by 2022; (2) revenues and sales declines in the quarters leading up to the Merger were not due to “idiosyncratic” customer behaviors as had been represented by MultiPlan, but rather due to increased competition and a fundamental deterioration in demand for MultiPlan’s services, as payers developed competing services seeking alternatives to eliminating excessive healthcare costs; (3) MultiPlan was facing significant pricing pressures for its services and had been forced to materially reduce its take rate in the period leading up to the Merger by insurers, who had expressed a dissatisfaction with the quality and price of MultiPlan’s balanced billing practices and services, which caused MultiPlan to cut its take rate by up to half in some cases; (4) MultiPlan was set to continue to suffer from earnings and revenue declines, increased competition and deteriorating pricing dynamics in the period following the Merger, as a result; (5) MultiPlan was forced to seek continued revenue growth and to improve its competitive positioning by way of costly acquisitions, which included the purchase of the healthcare technology company HST for $140 million at a premium price from a former MultiPlan executive only one month after the Merger, consequently; and (6) as such, investors had grossly overpaid for the acquisition of MultiPlan in the Merger, while MultiPlan’s business was worth far less than had been represented to investors.
A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than June 7, 2021.
Please visit our website to review more information and submit your transaction information.
The Portnoy Law Firm represents investors in pursuing claims arising from corporate wrongdoing. The Firm’s founding partner has recovered over $5.5 billion for aggrieved investors. Attorney advertising. Prior results do not guarantee similar outcomes.
Lesley F. Portnoy, Esq.
Admitted CA and NY Bar