Primary care provider sued amid allegations of SEC violations

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On Monday, a class action lawsuit was filed by Reginald Allison against Oak Street Health Inc. and several individual defendants. The case, filed in the Northern District of Illinois, alleges the company violated Securities and Exchange Commission (SEC) regulations through its marketing practices.

Oak Street, according to the complaint, operates primary care centers in the United States. The company engages with Medicare-eligible patients “through the use of an innovative approach to community outreach.”

However, the plaintiff claims that this approach exposed the company to liability in the form of a Department of Justice Civil Inquiry Request (CID). Specifically, “According to the CID, the DOJ is investigating whether the company has violated the False Claims Act. The CID is also requesting documents and information regarding Oak Street’s dealings with “third-party marketers” and the “provision of free transportation to federal health care recipients” through Oak Street.

SEC filings for Oak Street third quarter report reveal investigation; however, the plaintiff alleges that the first and second quarter filings did not disclose possible liabilities regarding Oak Street’s marketing and service arrangements. Disclosure of liabilities caused the share price to drop sharply in anticipation of possible sanctions.

The plaintiff is suing for violation of Articles 10 (B) and 20 (A) of the SEC Law. The plaintiff is represented by Miller Law LLC and Glancy Prongay & Murray LLP.

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