GENERAL INFORMATION
This Class Action pertains to all persons who purchased or otherwise acquired the common stock of HCA Inc. during the period from January 12, 2005 through and including July 12, 2005. The Settlement provides for the payment of $20,000,000 in cash by the Settling Defendants.
In the Action, Lead Plaintiffs allege that HCA and members of its senior management made false statements and omitted material facts between January 12, 2005 and July 12, 2005 regarding the Company’s growth and viability, which had the effect of artificially inflating HCA’s stock price. Under the Consolidated Complaint, Plaintiffs asserted claims under §10(b) and §20(a) of the Securities Exchange Act of 1934, and SEC Rule 10b-5 promulgated thereunder, against the Company and the Individual Defendants arising from public statements concerning the Company that Defendants made and omissions concerning the Company that Defendants failed to make from January 12, 2005 through July 12, 2005.
Defendants deny all allegations of any wrongdoing in the Action.
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In light of the amount of the Settlement and the immediacy of recovery to the Class, Lead Plaintiffs believe that the proposed Settlement is fair, reasonable and adequate, and in the best interests of the Class. Lead Plaintiffs believe that the Settlement provides a substantial benefit now, namely $20,000,000.00 in cash less the various deductions described in the Notice, as compared to the risk that all or some of the claims in the Action could have been dismissed in response to Defendants’ motions to dismiss, or that a similar, smaller, or no recovery would be achieved after motions for summary judgment, a trial and/or appeals, possibly years in the future, in which Defendants would have the opportunity to assert substantial defenses to the claims asserted against them.
Defendants deny the claims asserted against them in the Action or that they have engaged in any wrongdoing, violation of law or breach of duty, and the Settlement may not be construed as an admission of wrongdoing by any of the Defendants. Defendants have agreed to the Settlement in order to eliminate the burden and expense of continued litigation.
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The Class consists of all Persons who purchased or otherwise acquired HCA common stock during the period January 12, 2005 through and including July 12, 2005, and were damaged thereby.
Excluded from the Class are: (i) Defendants; (ii) the officers and directors of the Company; (iii) immediate family members of Defendants and the officers and directors of the Company and their legal representatives, heirs, successors, or assigns; and (iv) any entity in which Defendants have or had a controlling interest (which does not include any HCA employee retirement benefit plan established under the Employee Retirement Income Security Act).
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HCA Inc. (“HCA” or the “Company”), Jack O. Bovender, Jr.; Robert Milton Johnson; Richard M. Bracken; David G. Anderson; Charles R. Evans; James A. Fitzgerald, Jr.; Robert Samuel Hankins, Jr.; Samuel N. Hazen; Joseph N. Steakley; Beverly B. Wallace; and Noel Brown Williams are collectively known as the “Defendants”.
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Lead Counsel for Class:
BERNSTEIN LITOWITZ BERGER
& GROSSMANN LLP
Blair A. Nicholas, Esq.
Timothy DeLange, Esq.
12481 High Bluff Drive, Suite 300
San Diego, CA 92130
And
LERACH COUGHLIN STOIA GELLER
RUDMAN & ROBBINS LLP
Tor Gronborg
Thomas G. Wilhelm
655 West Broadway, Suite 1900
San Diego, CA 92101
These firms represent the interests of all Settlement Class Members. If you want to be represented by your own lawyer, you may hire one at your own expense.
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Counsel for Defendants:
LATHAM & WATKINS LLP
Everett C. Johnson, Jr.
555 Eleventh Street, N.W.
Washington, D.C. 20004
And
BOWEN RILEY WARNOCK & JACOBSON, PLC
Steven A. Riley
1906 West End Avenue
Nashville, TN 37203
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This website is only a summary and does not describe all of the details of the Stipulation of Settlement. For full details of the matters discussed on this website and in the NOTICE OF: (1) PENDENCY OF CLASS ACTION, AND (2) HEARING ON PROPOSED SETTLEMENT AND ATTORNEYS’ FEE PETITION AND RIGHT TO SHARE IN NET SETTLEMENT FUND (“Notice”), you may desire to review the Stipulation of Settlement filed with the Court, which may be inspected during business hours at:
Clerk’s Office at the United States District Court
for the Middle District of Tennessee (Nashville Division)
801 Broadway, Nashville, Tennessee 37203
You may also view the Stipulation of Settlement directly on this website. Further information regarding the HCA Inc. Securities Class Action and the Settlement may be obtained by contacting the Claims Administrator at:
In re HCA Inc. Securities Litigation
c/o The Garden City Group, Inc.
P.O. Box 9176
Dublin, OH 43017-4176
(800) 915-2989
PLEASE DO NOT WRITE OR TELEPHONE THE CLERK OF COURT OR THE JUDGE FOR INFORMATION OR ADVICE.
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FILING A CLAIM
To recover as a Class Member, you must complete and sign the Proof of Claim and Release and mail it to the Claims Administrator so that it is postmarked on or before November 26, 2007. If you fail to file a timely, properly addressed, and completed Proof of Claim and Release, your claim may be rejected and you may be precluded from receiving any distribution from the Settlement Fund. You are required to submit genuine and sufficient documentation for all your transactions in HCA common stock during the Class Period of January 12, 2005 through and including July 12, 2005 including your beginning and ending positions as indicated on the Proof of Claim and Release. All eligible transactions must be appropriately documented. Acceptable documentation generally includes periodic brokerage statements or trade confirmation slips.
Submission of the Proof of Claim and Release does not ensure that you will share in the proceeds of the Settlement Fund. Distributions from the Settlement Fund are governed by the Plan of Allocation approved by the Court. The proposed Plan of Allocation, which is subject to the Court’s approval, is included in the Notice.
If you have questions concerning the Proof of Claim and Release, you may contact the Claims Administrator, The Garden City Group, Inc., at the above address or by toll-free phone at (800) 915-2989. Additional copies of the Proof of Claim and Release are available on this website.
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You are required to submit genuine and sufficient documentation for all your transactions in HCA common stock during the Class Period of January 12, 2005 through and including July 12, 2005. All eligible transactions must be appropriately documented. Acceptable documentation generally includes periodic brokerage statements or trade confirmation slips. Documentation must include the claimant’s name and address and identify the security, trade date, price paid per share and total amount of transaction. Do NOT provide originals or copies of stock certificates, as they are not acceptable documentation of the trade date or price. Please send legible photocopies of your periodic brokerage statements or trade confirmation slips. You should keep a copy of the Proof of Claim and all supporting documentation you submit. IF SUCH DOCUMENTS ARE NOT IN YOUR POSSESSION, PLEASE OBTAIN COPIES OR EQUIVALENT CONTEMPORANEOUS DOCUMENTS FROM YOUR BROKER. FAILURE TO SUPPLY THIS DOCUMENTATION MAY RESULT IN REJECTION OF YOUR CLAIM. DO NOT SEND ORIGINAL STOCK CERTIFICATES.
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To recover as a Class Member, you must complete and sign the Proof of Claim and Release and mail it to the Claims Administrator so that it is postmarked on or before November 26, 2007.
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Additional copies of the Proof of Claim and Release are available on this website. Please go to the “Claim Form” page on this website to download additional copies.
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Yes. To participate in the distribution of the Net Settlement Fund, Class Members are required to complete and return the Proof of Claim and Release form along with all supporting documentation.
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If you purchased or otherwise acquired HCA common stock during the Class Period for the beneficial interest of a Person or organization other than yourself, you must either:
- Send a copy of this Notice and the Proof of Claim and Release, to the beneficial owner of the shares postmarked no later than fourteen (14) days from the date of this Notice; or
- Provide a list of the names and addresses of such beneficial owners to the Claims Administrator, preferably in a Microsoft Access data table (.mdb file), a Microsoft Excel spreadsheet (.xls file) or a tab-delimited or comma-delimited ASCII .txt file, setting forth:
- title/registration,
- street address,
- city/state/zip
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PLAN OF ALLOCATION
The objective of the Plan of Allocation is to equitably distribute the settlement proceeds to those Class Members who suffered economic losses as a result of the alleged fraud, as opposed to losses caused by market, industry or other non-fraud related Company specific factors. The Plan of Allocation reflects Lead Plaintiffs’ damages expert’s analysis undertaken to that end, including a review of publicly available information regarding HCA and statistical comparisons of the price movements of HCA’s common stock with the price performance of relevant market and industry indices during the Class Period.
The Settlement provides for a recovery of $20,000,000 in cash, which will be deposited into an interest-bearing escrow account within three (3) calendar days after the Court enters an order finally approving the Settlement. Lead Counsel’s fees, expenses and costs with interest thereon, to the extent allowed by the Court, as well as taxes, notification costs, and administration costs will be deducted from these Settlement proceeds, and the balance will be distributed to the Class. The amount of any recovery will depend on a number of factors, including:
- When and for what price Class Members purchased and/or sold their HCA common stock; and
- The total number of shares for which timely and valid Claim Forms are submitted by Class Members (“Authorized Claimants”)
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The Settlement Fund will be distributed as follows:
- To pay all federal, state and local taxes on any income earned by the Settlement Fund and to pay the reasonable costs incurred in connection with determining the amount of, and paying, taxes owed by the Settlement Fund (including reasonable expenses of tax attorneys and accountants);
- To pay costs and expenses in connection with providing Notice to Class Members and administering the Settlement on behalf of Class Members;
- To reimburse Lead Counsel for, and to pay, costs and expenses incurred by Lead Counsel in connection with, commencing and prosecuting the Action, with interest thereon, if and to the extent allowed by the Court;
- To pay Lead Counsel’s attorneys’ fees, to the extent allowed by the Court; and
- Subject to an Order of the Court granting approval of the Settlement and the Plan of Allocation (or such other allocation plan as the Court may approve) becoming final (meaning that the time for appeal or appellate review of the Order granting final approval has expired, or if the Order is appealed, that appeal is either decided without causing a material change in the Order or upheld on appeal and no longer subject to appellate review by further appeal or writ of certiorari) the balance of the Net Settlement Fund shall be distributed to Authorized Claimants in accordance with the Plan of Allocation.
After deduction for the payments set forth above, the Net Settlement Fund will be distributed to Authorized Claimants as allowed by the Stipulation, the Plan of Allocation, and/or the Court.
Each Authorized Claimant shall recover his or her Recognized Loss. However, in the event that the sum total of Recognized Losses of all Authorized Claimants who are entitled to receive payment out of the Net Settlement Fund is greater than the Net Settlement Fund, each such Authorized Claimant shall receive his/her pro rata share of the Net Settlement Fund, which shall be his/her Recognized Loss divided by the total of all Recognized Losses to be paid from the Net Settlement Fund, multiplied by the total amount in the Net Settlement Fund. The proration factor applied to the Authorized Claims of Class Members will be based on the amount in the Net Settlement Fund available to satisfy those claims.
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Lead Plaintiffs’ damages expert estimates that approximately 126 million shares of the Company’s common stock were traded during the Class Period and may have been affected by the conduct at issue in the Consolidated Complaint. Thus, assuming that the owners of all affected shares elect to participate, the average per share recovery from the Settlement Fund would be approximately $0.16 per affected share before deduction of attorneys’ fees, costs and expenses as approved by the Court.
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The Stipulation provides for an allocation of the Net Settlement Fund in accordance with the Plan of Allocation among Settlement Class Members who submit valid and timely Proof of Claim and Release Forms. Each Settlement Class Member’s Recognized Claim, if any, is calculated as explained in the Plan of Allocation. You may view the Plan of Allocation on this website. The Plan of Allocation was created by Lead Plaintiffs, through Lead Counsel, with the substantial assistance of an outside damages expert. None of the Settling Defendants nor any other of the Released Persons have any role in, or responsibility for, or liability whatsoever for the Plan of Allocation.
The amount of any recovery will depend on a number of factors, including:
- When and for what price Class Members purchased and/or sold their HCA common stock; and
- The total number of shares for which timely and valid Claim Forms are submitted by Class Members (“Authorized Claimants”)
Each Authorized Claimant shall recover his or her Recognized Loss. However, in the event that the sum total of Recognized Losses of all Authorized Claimants who are entitled to receive payment out of the Net Settlement Fund is greater than the Net Settlement Fund, each such Authorized Claimant shall receive his/her pro rata share of the Net Settlement Fund, which shall be his/her Recognized Loss divided by the total of all Recognized Losses to be paid from the Net Settlement Fund, multiplied by the total amount in the Net Settlement Fund. The proration factor applied to the Authorized Claims of Class Members will be based on the amount in the Net Settlement Fund available to satisfy those claims.
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No. Settlement Class Members will only be compensated for their pro rata share of damages asserted to be attributable to Settling Defendants’ alleged fraud. The movement of HCA common stock over time may include the effect of other market factors in addition to the movement of HCA common stock due to the alleged fraud.
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The receipt or grant by gift, devise or operation of law of HCA common stock during the Class Period shall not be deemed a purchase or sale of such HCA shares of common stock for the calculation of an Authorized Claimant’s Recognized Loss, nor shall it be deemed an assignment of any claim relating to the purchase of such HCA shares of common stock unless specifically provided in the instrument of gift or assignment.
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PARTICIPATION IN THE SETTLEMENT
Yes. Pursuant to the Hearing held on October 12, 2007, before the Honorable William J. Haynes, Jr., at the United States District Court for the Middle District of Tennessee (Nashville Division), 801 Broadway, Courtroom A859, Nashville, Tennessee, the Court granted Final Approval of the Settlement.
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Payments will be made after any appeals of the Court's approval of the Settlement are resolved, and after the completion of all claims processing. Please be patient.
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On October 15, 2007, the Court entered a judgment (the “Judgment”) dismissing the claims against Defendants with prejudice and providing that Lead Plaintiffs and all other Class Members, except those who validly and timely requested to be excluded from the Class, shall upon the Effective Date of the Settlement, be deemed to have, and by operation of the Judgment shall have, fully, finally, and forever released, waived, discharged and dismissed any and all Released Claims, including “Unknown Claims” (as defined in the Stipulation), against the Released Parties (as defined in the Stipulation) and any claims or potential claims that were or could be asserted in connection with the Action or Released Claims.
The Judgment also provides that Defendants and any of the other Released Parties shall each be deemed to have, and by operation of the Judgment shall have, fully, finally, and forever released, waived, and discharged all claims, whether known or unknown (including Unknown Claims), and whether arising under federal state or any other law, which have been, or could have been, asserted in the Action or in any court or forum, by Defendants, or any of them, against any of the Lead Plaintiffs, all Plaintiffs’ counsel, and/or any of their agents, which arise out of or relate in any way to the institution, maintenance, or settlement of the Action, except claims relating to the enforcement of the Settlement. The Judgment also bars all claims for contribution, indemnification or equitable indemnification against any party relating to the facts of this action, provided, however, that claims by Individual Defendants against HCA for defense costs and claims by the Defendants against their D&O carriers are not barred.
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The deadline to request exclusion has expired. Requests for exclusion were required to be postmarked no later than September 28, 2007.
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If a Settlement Class Member timely and validly requested exclusion from the Settlement Class, that Settlement Class Member will not participate in the distribution of the Net Settlement Fund, and is not bound by all proceedings, orders and judgments entered in connection with the Settlement.
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The deadline to object to the Settlement has expired. Objections were required to be filed on or before September 28, 2007.
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The Final Approval Hearing was held on October 12, 2007 before the Honorable William J. Haynes, Jr., at the United States District Court for the Middle District Court of Tennessee (Nashville Division), 801 Broadway, Courtroom A859, Nashville, Tennessee, 37203. Pursuant to this hearing, the Court granted Final Approval of the Settlement.
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The Final Approval Hearing was held on October 12, 2007.
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