Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against Healthcare Services Group Inc. (HCSG)
NEW YORK, March 25, 2019 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against Healthcare Services Group Inc. (“Healthcare” or the “Company”) (NYSE: HCSG) in the United States District Court for the Eastern District of Pennsylvania on behalf of those who purchased or acquired the securities of the Company between April 11, 2017 and March 4, 2019, inclusive (the “Class Period”), seeking to recover damages caused by Defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder.
The Complaint alleges that Defendants misled investors by strategically rounding up the Company's earnings per share ("EPS") metric for over a decade. On March 4, 2019, Defendants announced the SEC has been investigating the Company's EPS rounding and reporting practices since November 2017.
The Complaint also alleges that throughout the Class Period, the Company artificially inflated the price of its securities by misrepresenting the value of the Company’s business and prospects, by overstating its earnings, and by concealing significant defects in its internal controls.
The Complaint alleges that the truth was revealed to shareholders on March 4, 2019, when the Company revealed that it had received a letter in November 2017 from the SEC regarding an inquiry that the SEC was conducting into EPS calculation practices and requesting that the Company voluntarily provide certain information and documents. The Company also revealed that, during the fourth quarter of 2018, the Company authorized its outside counsel to conduct an internal investigation, under the direction of the Company’s Audit Committee, into matters related to an SEC subpoena which the Company had received, and that the Company was unable to file its Annual Report on Form 10-K for the year ended December 31, 2018 on time.
On this news, the Company’s stock price fell $4.96 per share, or 13.14%, to close at $32.78 on March 4, 2019.
Investors who purchased or otherwise acquired shares during the Class Period should contact the Firm prior to the May 21, 2019 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at [email protected] or [email protected].
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