Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/cyh/) today announced that a class action has been commenced in the United States District Court for the Middle District of Tennessee on behalf of purchasers of the common stock of Community Health Systems, Inc. (“CYH” or the “Company”) (NYSE:CYH) between July 27, 2006 and April 11, 2011, inclusive (the “Class Period”), seeking to pursue remedies under the Securities Exchange Act of 1934 (the “Exchange Act”).
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from May 9, 2011. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, David J. George of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at firstname.lastname@example.org. If you are a member of this Class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/cyh/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges CYH and certain of its officers and executives with violations of the Exchange Act. CYH is the largest publicly traded operator of hospitals in the United States, and provides healthcare services in non-urban and selected urban markets throughout the United States.
The complaint alleges that, throughout the Class Period, defendants failed to disclose material adverse facts about the Company’s true financial condition, business and prospects. Specifically, the complaint alleges: (a) the Company’s growth statistics, revenues, and profits were artificially inflated as a result of CYH’s improper admissions procedures designed to overbill Medicare and other sources for patient admissions; (b) notwithstanding defendants’ statements touting the financial and strategically compelling advantages that would result from CYH’s acquisition of Tenet Healthcare, the truth was that CYH’s growth statistics, revenues, and profits were artificially inflated, making the potential synergies arising from the acquisition much less compelling than defendants represented; (c) as a result, defendants knew that the profit and revenue numbers that they forecast to the market were illusory and unattainable; and (d) as a result of the foregoing, defendants’ statements regarding the Company’s financial performance and expected earnings were false and misleading and lacked a reasonable basis when made.
On April 11, 2011, The Wall Street Journal, in an article entitled “Tenet Claims Community Health Overbilled Medicare,” informed the market of the fraudulent practices occurring at CYH. As a result of the disclosure, which ultimately revealed CYH’s improper admissions practices as well as CYH’s true financial condition and future business prospects, the price of CYH common stock dropped 35.7% from a closing price $40.30 on April 8, 2011 to close at $25.89 on April 11, 2011, the next trading day, on heavy trading volume.
Plaintiff seeks to recover damages on behalf of all purchasers of the common stock of CYH during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller, a 180-lawyer firm with offices in San Diego, San Francisco, New York, Boca Raton, Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Robbins Geller Web site (http://www.rgrdlaw.com) has more information about the firm.