Investors filed a class action lawsuit against Psychiatric Solutions (Nasdaq: PSYS) and certain of its officers and directors on behalf of shareholders who bought Psychiatric Solutions’ stock between February 21, 2008 and February 25, 2009. The class action lawsuit was filed in federal court in Nashville, Tennessee.
The lawsuit alleges Psychiatric Solutions and certain of its officers and directors concealed material information from shareholders about the company’s: (1) failure to provide patient safeguards and controls at its Riveredge facility; (2) failure to implement corrective measures and comply with government regulations; and (3) failure to comply with accounting regulations and issuance of false financials.
On February 25, 2009, Psychiatric Solutions disclosed ongoing safety and compliance problems at its Riveredge facility had caused the company to underperform and miss 2008 financial guidance. In response to this news, Psychiatric Solutions’ stock dropped 35% in a single day to close at $17.50 per share.
The lawsuit charges Psychiatric Solutions and certain of its officers and directors with violations of the federal securities laws and seeks to recover damages for all investors who purchased Psychiatric Solutions stock between February 21, 2008 and February 25, 2009.
If you have questions about this lawsuit, want to discuss your legal rights or you wish to join this class action, please call 1-877-573-0007 for a free consultation.
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