PHILADELPHIA, Sept. 10, 2007 (PRIME NEWSWIRE) -- Law Offices Bernard M. Gross, P.C. announces that the firm filed a class action lawsuit in the United States District Court for the Middle District of Florida, Civil Action No. 2:07-cv-567-FTM-34SPC, on behalf of purchasers of the common stock of Health Management Associates ("HMA" or the "Company") (NYSE:HMA) between January 17, 2007 and July 30, 2007, inclusive (the "Class Period"), alleging violations of the Securities Exchange Act of 1934 (the "Exchange Act"). During this time period, certain company insiders sold over 900,000 shares of HMA stock for gross proceeds in excess of $17 million.
The complaint charges HMA, William J. Schoen, Joseph V. Vumbacco and Robert E. Farnham with violations of Sections 10 (b) and 20 (a) of the Exchange Act, by issuing materially false and misleading statements. Specifically, the complaint alleges that defendants failed to disclose: (1) that the Company was experiencing a deterioration in its collection of accounts receivable from uninsured patients; (2) that the Company was significantly under-reserving for bad debt expense; (3) that the Company would be forced to dramatically increase its provision for bad debt expense going forward, which would severely impact the Company's net earnings in subsequent quarters; (4) that the Company's financial statements were materially misleading; (5) that the Company's materially misleading financial statements enabled the Company to effectuate a major recapitalization which was otherwise unattainable; (6) that the Company lacked adequate internal and financial controls; and (7) that the Company's statements about its financial well-being, earnings and guidance were lacking in a reasonable basis when made.
On July 31, 2007, HMA announced that their 2nd quarter net income dropped 85% and the Company cut in half expected earnings for the full year. On this unexpected news, the price of HMA stock dropped almost 25% to close at $8.06 on July 31, 2007 and has declined further.
Plaintiff seeks to recover damages on behalf of all those who purchased the common stock of HMA between January 17, 2007 and July 30, 2007. In order to serve as lead plaintiff, however, you must meet certain legal requirements and file a motion for appointment as lead plaintiff by October 1, 2007.
This firm also recently filed securities class actions against RAIT FINANCIAL TRUST, (RAS-NYSE), class period, 1/10/07-7/31/07;Radian Group, Inc., (RDN-NYSE), class period, 1/23/07-7/31/07; Limelight Networks, Inc., (LLNW-NASDAQ), class period, 6/8/07-8/8/07; Motorola, Inc., (MOT-NYSE), class period, 7/19/06-1/4/07; Northwest Biotherapeutics, Inc., (NWBO.OB-OTCBB), class period, 7/9/07-7/16/07.
More information on this and other class actions can be found on the Class Action Newsline at www.primenewswire.com/ca.