HealthSouth: Dismiss Investor Suits
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BIRMINGHAM, Ala. (AP) _ HealthSouth Corp. has asked a federal court to dismiss 15 class-action lawsuits filed by investors over the collapse of its stock price, calling the suits unfounded.
HealthSouth also said it had elected Robert P. May, formerly a senior executive with FedEx Corp., as an independent director to chair a new litigation committee.
HealthSouth confirmed last month it was being investigated by the Securities and Exchange Commission after the Birmingham-based company revealed earnings would be much lower than expected. HealthSouth also disclosed that founder and chairman Richard Scrushy had sold half his stake in the company before the profit warning.
Lawsuits have been filed against Scrushy and HealthSouth executives questioning the timing of the stock sale and whether information was kept from shareholders who lost some $2.7 billion in value on the initial price plunge.
HealthSouth owns and operates rehabilitation hospitals and clinics around the country and is one of the nation’s largest outpatient surgery providers.
HealthSouth shares rose 10 cents Tuesday to close at $4.25 on the New York Stock Exchange. The stock is down from a high of $16.84 a share over the last year.
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