In Norfolk Cty. Ret. Sys. v. Cmty Health Sys., Inc., 877 F.3d 687 (6th Cir. 2017), the United States Court of Appeals for the Sixth Circuit reversed the district court’s judgment in favor of Community Health System shareholders (“Plaintiffs”). The Court of Appeals ruled that under §10(b) of the Securities Exchange Act and Rule 10b-5 promulgated thereunder, Plaintiffs plausibly alleged the value of Community Health Systems’s (“Defendant”) shares fell because of undisclosed practices. Defendant’s profits relied on Medicare fraud, which they failed to disclose. The Plaintiffs allege that the market reacted negatively once those fraudulent practices were revealed, resulting in a loss in the value of their shares.
Read MoreIn Dinnen v. Kneen, No. 16-cv-00882-PAB-STV, 2017 BL 332704 (D. Colo. Sept. 19, 2017), the United States District Court for the District of Colorado granted PdC, LLC, Timothy Kneen, Michael Roberts, Timothy Flaherty, and Carl Vertuca’s (“Defendants”) Motion to Dismiss, finding that Michael W. Dinnen’s (“Plaintiff”) Amended Complaint failed to sufficiently allege scienter in the Section 10(b) claim under the heightened pleading requirements of the Private Securities Litigation Reform Act (“PSLRA”).
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