HARTFORD, Conn., Aug. 3, 2007 (PRIME NEWSWIRE) — The law firm of Schatz Nobel Izard P.C., which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the Middle District of Florida on behalf of all persons who purchased the publicly traded securities of Health Management Associates, Inc. (”Health Management”) (NYSE:HMA) between January 17, 2007 and July 30, 2007, inclusive (the “Class Period”).
The Complaint charges that Health Management Associates and certain of its officers and directors violated federal securities laws. Specifically, defendants engaged in a scheme to create the impression that the Company had its “bad debt expenses” under control in order to borrow additional money, and to get the Board to approve of their recapitalization plan. On January 17, 2007, Health Management announced a major recapitalization which was completed in March 2007 and which required the company to borrow $3.25 billion of new debt to refinance existing debt and pay shareholders a special one-time cash dividend of $10.00. The Individual Defendants benefited substantially from this one time dividend, given that they were major shareholders and each defendant received large sums of money.
On July 31, 2007, Health Management announced that for its second quarter of 2007 it took a $39.0 million charge, and recorded it as an additional reserve to reflect a decline in collectibility of accounts receivable from uninsured patients. Moreover, the Company updated its fiscal 2007 diluted EPS from continuing operations objective range to be between $0.45 and $0.50 to reflect increased uninsured volumes, a deterioration in the collectibility of accounts receivable related to those uninsured volumes, and lower than anticipated overall paying volumes. On this news, Health Management stock dropped almost 25% to close at $8.06 on July 31, 2007.
If you are a member of the class, you may, no later than October 1, 2007, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members, including decisions concerning settlement. The securities laws require the Court to consider the class member(s) with the largest financial interest as presumptively the most adequate lead plaintiff(s).
While Schatz Nobel Izard P.C. has not filed a lawsuit against the defendants, to view a copy of the Complaint initiating the class action or for more information about the case, class action cases in general, and your rights, please contact Schatz Nobel Izard P.C. toll-free at (800) 797-5499, or by e-mail at firm@snilaw.com, or visit our website: www.snilaw.com.
CONTACT: Schatz Nobel Izard P.C.
Wayne T. Boulton or Nancy A. Kulesa
(800) 797-5499
firm@snilaw.com
www.snilaw.com
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