City of Pittsburgh Comprehensive Municipal Pension Trust Fund et al. v. Benefitfocus, Inc.

"The Action arises from the secondary public offering of the common stock of cloud-based benefits management platform and services provider Benefitfocus, commenced on or about March 1, 2019, and alleged misstatements and omissions of a material fact made to investors in the Offering Documents issued in connection with the SPO. More specifically, the Action concerns Defendants’ alleged failure to disclose that prior to the SPO, non-party Mercer Health & Benefits, LLC (“Mercer Health”), allegedly one of Benefitfocus’s most important customers, was purportedly terminating its contract with the Company and would be transitioning off the Benefitfocus platform. (Defendants deny that Lead Plaintiff has asserted any valid claims as to any of them, and expressly deny any and all allegations of fault, liability, wrongdoing, or damages whatsoever.) As a result, Lead Plaintiff alleged that the Offering Documents were false and misleading for several reasons, including: (i) the alleged termination of the agreement with Mercer Health was falsely portrayed as an amendment in the Offering Documents; (ii) purported opportunities arising from the change in relationship with Mercer Health were allegedly non-existent; and (iii) the Company’s financial condition was allegedly worse than the Offering Documents portrayed."