LOS ANGELES--(BUSINESS WIRE)-- The Law Offices of Todd M. Garber announces that a class action lawsuit has been filed in the United States District Court for the Eastern District of Wisconsin on behalf of a class (the “Class”) consisting of all purchasers of the Class A common stock of Assisted Living Concepts, Inc. (“ALC” or the “Company”) (NYSE:ALC) between March 12, 2011 and August 6, 2012, inclusive (the “Class Period”).
ALC, together with its subsidiaries, operates senior living residences in the United States. In January 2008 ALC acquired eight facilities that it leased from Ventas Realty Limited Partnership. Under the terms of its lease with Ventas (the “Ventas Lease”), ALC was obligated to maintain overall occupancy of at least 82% and all regulatory licenses required to operate the leased facilities for their intended use. In its quarterly and annual SEC filings during the Class Period, ALC affirmatively stated that it was in compliance with all occupancy and operating covenants under the Ventas Lease.
The Complaint alleges that unbeknownst to investors: (1) there is substantial evidence that during the Class Period ALC was in breach of the Ventas Lease’s minimum occupancy covenants, which ALC concealed by treating units leased to employees as bona fide rentals by third parties; and (2) also undisclosed until it was revealed in a lawsuit filed by Ventas in late April 2012 (the “Ventas Litigation”), Georgia and Alabama state regulators served notices in February and March 2012 of their intent to revoke licenses for three of the facilities leased from Ventas.
In early May 2012, the audit committee of ALC’s board of directors launched an investigation after receiving an internal whistleblower complaint concerning “possible irregularities” in connection with the Ventas Lease.
On June 21, 2012, ALC announced a settlement of the Ventas Litigation. As a result of the settlement, for the first six months of 2012 ALC reported a net loss of $19.5 million – nearly equal to ALC’s entire net income for 2011.
Then, on August 7, 2012 the Company announced that it was the subject of an investigation by the Securities and Exchange Commission concerning, among other things, “compliance with occupancy covenants” under the Ventas Lease and the “leasing of units for employee use.”
If you are a member of the above-described Class, you may move the Court no later than October 29, 2012 to serve as lead plaintiff; however, you must meet certain legal requirements. To be a member of the Class you need not take any action at this time, or you may retain counsel of your choice. If you have information or would like to learn more about these claims, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Todd M. Garber, Esquire, of the Law Offices of Todd M. Garber, by telephone at 213-700-7262 or by email to firstname.lastname@example.org.
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Law Offices of Todd M. Garber
Todd M. Garber, Attorney at Law
Los Angeles, California
Source: Law Offices of Todd M. Garber