Oak Street Health, Inc.

On November 8, 2021, Oak Street disclosed that on November 1, 2021 the Company received a civil investigative demand (“CID”) from the United States Department of Justice (“DOJ”). According to the CID, the DOJ was investigating whether the Company violated the False Claims Act. The CID also requests documents and information related to the Oak Street’s relationships with “third-party marketing agents” and Oak Street’s “provision of free transportation to federal health care beneficiaries.”

On this news, the Company’s share price fell $9.75, or more than 20%, to close at $37.14 per share on November 9, 2021, on unusually heavy trading volume.

The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Oak Street maintained relationships with third-party marketing agents likely to provoke law enforcement scrutiny; (2) that Oak Street was providing free transportation to federal health care beneficiaries in a manner that would provoke law enforcement scrutiny; (3) that these activities may be violations of the False Claims Act; (4) that, as such, Oak Street was at heightened risk of investigation by the DOJ and/or other federal law enforcement agencies; (5) that, as a result, Oak Street was subject to adverse impacts related to defense and settlement costs and diversion of management resources; and (6) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.