LINDA WONG, individually and on behalf of all others similarly situated, Plaintiff-Appellee,
ACCRETIVE HEALTH, INC., et al., Defendants-Appellees
Argued: October 2, 2014
Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 12-CV-03102. Sharon Johnson Coleman, Judge.
For LINDA WONG, individually and on behalf of all others similarly situated, Plaintiff - Appellee: James E. Barz, Attorney, Robbins Geller Rudman & Dowd Llp, Chicago, IL; Kevin Kamuf Green, Attorney, Robbins Geller Rudman & Dowd Llp, San Diego, CA.
James J. Hayes, Appellant, Pro se, Annandale, VA.
For Accretive Health, Incorporated, Defendant - Appellee: Leonid Feller, Attorney, Kirkland & Ellis Llp, Chicago, IL.
For Mary A. Tolan, John T. Staton, Defendants - Appellees: Leonid Feller, Attorney, Kirkland & Ellis Llp, Chicago, IL.
Before FLAUM, MANION, and HAMILTON, Circuit Judges.
Manion, Circuit Judge.
The Indiana State Police Benefit System, as lead plaintiff in a class action, sued Accretive Health, Inc., and two of its officers under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. James Hayes, a member of the class, appeals pro se from the approval of the class settlement and plan of distribution. We hold that the district court did not abuse its discretion in approving the settlement, and therefore affirm.
Accretive is a nationwide company that provides cost control, revenue cycle management, and compliance services primarily to not-for-profit healthcare providers. Underlying the suit are two contracts Accretive entered into with Minnesota-based Fairview Health Systems worth several million dollars each. The first contract, called a Revenue Cycle Operations Agreement (" RCA" ), accounted for approximately 12% of Accretive's revenue during the class period. Accretive's second contract with Fairview, called a Quality and Total Cost of Care (" QTCC" ) contract, was the first of its kind and was held out by Accretive as the future for healthcare services. The Indiana State Police Benefit System (" ISPBS" ) alleged that Accretive provided its services through overly aggressive collection practices and with inadequate regulatory compliance, conduct that was both illegal and in violation of its contracts with Fairview. ISPBS further alleged that Accretive concealed this fact and instead represented that it complied with the law and its contractual obligations in an effort to artificially inflate the price of Accretive common stock.
Certain newsworthy events eventually uncovered Accretive's alleged improper and unlawful conduct. On January 19, 2012, the Minnesota Attorney General sued Accretive for failure to comply with healthcare, debt collection, and consumer protection laws. In response to the lawsuit, Accretive announced on March 29, 2012, that it was winding down its RCA contract well short of its five-year term and expecting a loss of $62 to $68 million in revenue. On April 24, 2012, the Minnesota Attorney General released a ...