Robbins LLP is Investigating Allegations that Acadia Healthcare Company (ACHC) Misled Investors About Its Business Practices

Robbins LLP reminds investors of their rights following the court's decision to allow securities claims against Acadia Healthcare Company (NASDAQ: ACHC) to proceed.

The case is continuing after the Court denied defendants’ motion to dismiss the amended complaint. The ruling means the case can proceed past the motion-to-dismiss stage. Investors who purchased or otherwise acquired Acadia Healthcare securities during the applicable class period and suffered losses may still have rights in the litigation.

The class action alleges that Acadia Healthcare misled investors concerning its patient admission and detention practices, treatment of patients, and billing practices.

What Does the Court’s Decision Mean for Acadia Healthcare Investors?

A motion to dismiss asks the Court to end a lawsuit at an early stage, before the case proceeds through the litigation process.

By denying the motion to dismiss the amended complaint, the Court has allowed the claims to proceed. The ruling does not mean that investors have won the case, nor does it establish that Acadia Healthcare engaged in wrongdoing. Those issues remain to be determined as the litigation proceeds.

For investors who suffered losses in Acadia Healthcare securities, however, the decision means that the litigation remains active and their potential rights have not been extinguished.

What Are the Allegations Against Acadia Healthcare?

According to the amended complaint, defendants made false and/or misleading statements and failed to disclose material information concerning Acadia Healthcare's business practices.

The complaint alleges that Acadia's business model centered on holding vulnerable patients against their will in its facilities, including circumstances in which such detention was allegedly not medically necessary.

The complaint further alleges that:

• patients at Acadia Healthcare facilities were subjected to abuse;
• Acadia allegedly deceived insurance providers into paying for patient stays that were not medically necessary; and
• Acadia's public statements concerning its business and operations were materially false or misleading because they allegedly failed to disclose these practices and related risks.

How Did the Allegations Become Public?

According to the complaint, information concerning Acadia's alleged practices emerged through investigative reporting and subsequent disclosures concerning government inquiries.

On September 1, 2024, The New York Times published an investigative article titled “How a Leading Chain of Psychiatric Hospitals Traps Patients.” The article reported allegations concerning Acadia's patient admission and detention practices and detailed individual patient experiences.

Following publication of the article, Acadia Healthcare's stock price fell $3.72 per share, or approximately 4.5%, to close at $78.21 per share on September 3, 2024, according to the complaint.

Then, on September 27, 2024, Acadia disclosed that it had received a voluntary request for information from the United States Attorney's Office for the Southern District of New York and a grand jury subpoena from the United States District Court for the Western District of Missouri concerning its admissions, length-of-stay, and billing practices.

Following that disclosure, Acadia's stock price fell $12.38 per share, or approximately 6.36%, to close at $63.28 per share on September 27, 2024, according to the complaint.

What Can Shareholders Do Now?

Investors who have questions about their rights should contact Robbins LLP for more information.

All representation is on a contingency fee basis. Shareholders pay no fees or expenses.