Frequently Asked Questions
- Why did I get a Notice package?
- What is this lawsuit about?
- What does the Settlement provide?
- What is the estimated average amount of recovery per share?
- What is the statement of potential outcome of the case?
- What are the Attorneys’ fees and expenses being sought?
- Do I have a lawyer in this case?
- Who is representing the Settlement Class?
- What are the reasons for the Settlement?
- How do I participate in the Settlement?
- How do I exclude myself from the Settlement?
- If I exclude myself, can I get money from the Settlement?
- Can I object without excluding myself from the Settlement?
- If I file an objection do I need to hire an attorney?
- When will the Court decide whether to approve the Settlement?
- Do I have to come to the hearing?
- May I Speak At the Hearing If I Don't Like the Settlement?
- What happens if I do nothing at all?
- How do I get more information?
Why did I get a Notice package?
The Notice was sent to you pursuant to an Order of the Court because of purchases or acquisitions of HIIQ Securities during the Class Period (i.e., August 4, 2017, and September 11, 2017) by you, someone in your family, or an investment account for which you serve as custodian. The Court has directed the Notice be sent because, as a potential Settlement Class Member, you have a right to know about your options before the Court rules on the proposed Settlement of this Litigation. Additionally, you have the right to understand how a class action lawsuit may generally affect your legal rights. If the Court approves the Settlement, Epiq Class Action & Claims Solutions, Inc., the Claims Administrator selected by Lead Plaintiff and approved by the Court, will distribute payments pursuant to the Plan of Allocation after any objections and appeals are resolved.
To view a copy of the Notice, click here.Back To Top
What is this lawsuit about?
The Lawsuit relates to a proposed Settlement of claims in a pending securities class action lawsuit brought by investors alleging, among other things, that Defendants HIIQ and Michael D. Hershberger (collectively, the “Defendants”) violated the federal securities laws by failing to disclose facts regarding the Company’s unsuccessful application for its third-party administrator license with the Florida Office of Insurance Regulation, and the risks these facts posed to the Company’s business, prospects, and operations.
The proposed Settlement, if approved by the United States District Court for the Middle District of Florida (the “Court”), will settle claims of the Settlement Class of Persons and entities that were certified by the Court pursuant to an Order issued on November 19, 2020.
The “Settlement Class,” as certified by the Court for purposes of this Settlement, means all Persons or entities who purchased or otherwise acquired HIIQ Class A Common Stock (trading symbol “HIIQ”) or exchange-traded Call Options on HIIQ Class A Common Stock and all persons who sold (wrote) exchange-traded Put Options on HIIQ Class A Common Stock between August 4, 2017, and September 11, 2017, inclusive. Excluded from the Settlement Class are Defendants, all current and former directors and officers of Health Insurance Innovations, Inc., each of their respective family members, and any affiliates controlled or owned by any of these excluded individuals and/or entities. Also excluded from the Settlement Class are those persons who timely and validly request exclusion from the Settlement Class pursuant to the procedure described in FAQ 11.Back To Top
What does the Settlement provide?
Subject to Court approval, and as described more fully in the Settlement Agreement, Lead Plaintiff, on behalf of himself and the Settlement Class, has agreed to settle all claims based on the purchase or other acquisition of HIIQ publicly traded Securities during the Class Period that were or could have been asserted against Defendants in the Litigation in exchange for a Settlement payment of Two-Million Eight-Hundred Thousand Dollars ($2,800,000.00) in cash (the “Settlement Amount”) to be deposited into an interest-bearing escrow account.
The Net Settlement Fund (i.e., the Settlement Amount plus any and all interest earned thereon (the “Settlement Fund”) less any (i) Taxes, (ii) Notice and Administration Costs, (iii) expenses of Plaintiff’s Counsel or Lead Plaintiff (“Litigation Expenses”) awarded by the Court; and (iv) attorneys’ fees awarded by the Court) will be distributed in accordance with a plan of allocation that is approved by the Court, which will determine how the Net Settlement Fund shall be allocated among members of the Settlement Class. See the proposed plan of allocation (the “Plan of Allocation”) for more information.Back To Top
What is the estimated average amount of recovery per share?
Lead Plaintiff’s damages expert estimates that, between August 4, 2017, and September 11, 2017, approximately 28.5 million shares of HIIQ Class A Common Stock were purchased during the Class Period and held through an alleged corrective disclosure and therefore allegedly were damaged. Lead Plaintiff’s damages expert estimates that, if valid claims for all such Class A Common Stock are submitted, the average recovery per share for the HIIQ Class A Common Stock will be approximately $0.10 per share, before deduction of attorneys’ fees, costs, and expenses awarded by the Court and the costs of providing notice and administering the Settlement.
A Class Member’s actual recovery will depend on several things, including: (i) the total number of claims filed; (ii) the date when Class Members purchased, acquired, or transacted in their HIIQ Securities during the Class Period; and (iii) whether and when Class Members sold their HIIQ Securities. Distributions to Class Members will be made based on the Plan of Allocation or such other plan of allocation as may be ordered by the Court.Back To Top
What is the statement of potential outcome of the case?
The Parties disagree on the potential liability of Defendants, and they do not agree on the average amount of damages per share, if any, that would be recoverable if Plaintiff would have prevailed at trial. Defendants deny that they are liable in any respect or that Lead Plaintiff suffered any injury.
The issues on which the Parties disagree include:
- whether any Defendant engaged in any conduct subject to challenge under the federal securities laws;
- the amounts by which HIIQ Securities were allegedly artificially inflated (if at all) during the Class Period;
- the effect of various market forces influencing the trading price of HIIQ Securities at various times during the Class Period;
- the extent to which the various matters that Lead Plaintiff alleged were materially false or misleading influenced (if at all) the trading price of HIIQ Securities during the Class Period;
- the extent to which the various allegedly adverse material facts that Lead Plaintiff alleged were omitted influenced (if at all) the trading price of HIIQ Securities during the Class Period;
- whether the statements made or facts allegedly omitted were material, false, misleading, or otherwise actionable under the securities laws; and
- whether, even if liability could be proven, total damages would be greater than $0.
What are the Attorneys’ fees and expenses being sought?
Court-appointed Lead Counsel, Kahn Swick & Foti, LLC, and Court-appointed Liaison Counsel, George Gesten McDonald, PLLC (collectively referred to as “Plaintiff’s Counsel”), have been prosecuting the Litigation on a wholly contingent basis since its inception in 2017, have not received any payment of attorneys’ fees for their representation of the Settlement Class, and have advanced hundreds of thousands of dollars in expenses necessarily incurred in order to prosecute the Litigation.
Plaintiff’s Counsel were responsible for:
- Conducting an extensive investigation into the Settlement Class’ claims;
- Drafting a detailed consolidated complaint;
- Successfully opposing Defendants’ dismissal motion;
- Briefing Lead Plaintiff’s motion for class certification;
- Engaging in an extensive discovery program, including deposing Defendants’ economic consultant and reviewing thousands of pages of documents;
- Engaging in multiple in-person meetings, telephonic meetings, and a videoconference meeting regarding a possible Settlement of the Litigation; and
- Briefing an independent and experienced mediator on relevant claims and applicable law before reaching with the mediator’s assistance an agreement in principle to settle.
Plaintiff’s Counsel will ask the Court to award attorneys’ fees in an amount not to exceed 33 1/3% of the Settlement Fund. Plaintiff’s Counsel also will apply for the reimbursement of Litigation Expenses paid or incurred in connection with the prosecution and resolution of the Litigation, in an amount not to exceed $315,000.00, which may include the reasonable costs and expenses of Settlement Class Representative directly related to his representation of the Settlement Class. If the Court approves Plaintiff’s Counsel’s fee and expense application, the average cost per affected share of HIIQ Class A Common Stock will be approximately $0.04.Back To Top
Do I have a lawyer in this case?
As a Settlement Class Member, you are represented by Robert Rector as the Settlement Class Representative and Kahn Swick & Foti, LLC as Lead Counsel for the Settlement Class, unless you enter an appearance on your behalf or through counsel of your own choice at your own expense. You are not required to retain your own counsel, but if you choose to do so, such counsel must file a notice of appearance on your behalf and serve copies of his or her notice of appearance on the following attorneys: (a) Ramzi Abadou, Kahn Swick & Foti, LLC, 1100 Poydras Street, Suite 3200, New Orleans, LA 70163; and (b) Robert F. Serio, Gibson, Dunn & Crutcher LLP, 200 Park Avenue, New York, NY 10166-0193.Back To Top
Who is representing the Settlement Class?
The Settlement Class are being represented by "Class Counsel" who is comprised of the following attorneys:
Ramzi Abadou, Esq.
Kahn Swick & Foti, LLP
912 Cole Street, #251
San Francisco, CA 94117
Alexander L. Burns, Esq.
Alayne K. Gobeille, Esq.
Kahn Swick & Foti, LLC
1100 Poydras Street
New Orleans, LA 70163
David J. George, Esq.
George Gesten McDonald, PLLC
9897 Lake Worth Road, Suite 302
Lake Worth, FL 33467
What are the reasons for the Settlement?
Lead Plaintiff’s principal reason for entering into the Settlement is the substantial cash benefit for the Settlement Class, without the risk or the delays inherent in further litigation. Moreover, the substantial cash benefit provided under the Settlement must be considered against the significant risk that a smaller recovery—or, indeed, no recovery at all—might be achieved after a trial of the Litigation and the likely appeals that would follow a trial, a process that could last many months, or even years, into the future.
Defendants, who believe that Lead Plaintiff could not prove his claims or refute Defendants’ defenses and who deny all allegations of wrongdoing or liability whatsoever, are entering into the Settlement to eliminate the uncertainty inherent in any litigation, to avoid further expense, inconvenience, and distraction of burdensome and protracted litigation, and to secure releases to the fullest extent permitted by law.
The amount of damages recoverable by Settlement Class Members was and is challenged by Defendants. Recoverable damages in this case are limited to losses caused by conduct actionable under applicable law and, had the Litigation gone to trial, Defendants would have asserted that all or most of the losses of Settlement Class Members were caused by non-actionable conduct or market, industry, or general economic factors. Defendants would also assert, among other things, that their conduct complied with all applicable legal standards and that they did not act with the required state of mind to be liable for any violations of the federal securities laws.Back To Top
How do I participate in the Settlement?
To be eligible for a payment from the proceeds of the Settlement, you must be a member of the Settlement Class, and you must timely complete and return the Proof of Claim and Release Form with adequate supporting documentation. A Proof of Claim and Release Form is available for download here. You may also request that a Proof of Claim and Release Form be mailed to you by calling the Claims Administrator, Epiq, at 1-855-958-3603 email at info@HIIQSecuritiesLitigation.com.
Proof of Claim and Release Form forms must be postmarked no later than April 8, 2021, or by a later date, if any, specified by the Court.
Please retain all records of your ownership of and transactions in HIIQ Securities, as they may be needed to document your claim. If you are excluded from the Settlement Class as defined in FAQ 2, you submit a request for exclusion per the instructions in FAQ 11, or if you do not submit a timely and valid Proof of Claim and Release Form, you will not be eligible to share in the Net Settlement Fund.Back To Top
How do I exclude myself from the Settlement?
If you do not want to be bound by the Judgment or recover money from the Settlement Fund and instead want to keep any claims you may have and any right you may have to sue the Defendants on your own about the legal issues in this case, then you must take steps to get out. This is called excluding yourself from— or opting out of—the Settlement Class. If you do not wish to be included in the Settlement Class and you do not wish to participate in the proposed Settlement, you may request to be excluded.
To do so, you must submit a written request for exclusion that must be received on or before February 2, 2021, (at least 21 calendar days prior to the date of the Settlement Hearing), by the Claims Administrator at the address below and must state:
- The name, address, and telephone number of the person requesting exclusion;
- The person’s purchases/acquisitions/transactions of HIIQ Securities during the Class Period and any sales thereof, including the dates, the number of shares, and price(s) paid and received for each such purchase, acquisition, and sale;
- A clear and unambiguous statement that the person wishes to be excluded from the Settlement Class; and
- Must include the person’s signature.
No request will be considered valid unless all of the information described above is included in the request. You cannot exclude yourself by phone, email, or on this website. The written request must be addressed as follows:
In Re Health Insurance Innovations Securities LitigationBack To Top
P.O. Box 2530
Portland, OR 97208-2530
If I exclude myself, can I get money from the Settlement?
If you ask to be excluded from the Settlement Class, you will not get any Settlement payment.Back To Top
Can I object without excluding myself from the Settlement?
Any Settlement Class Member who is not requesting exclusion from the Settlement Class may object to the proposed Settlement, the proposed Plan of Allocation, or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses. Objections must be in writing. You must file any written objection, together with copies of all other papers and briefs supporting the objection, with the Clerk’s Office of the Court at the address set forth below on or before February 2, 2021. You must also serve the papers on Lead Counsel for the Settlement Class and Defendants’ Counsel at the addresses set forth below so that the papers are received on or before February 2, 2021.
Any objection to the Settlement must include:
- The name, address, and telephone number of the person or entity objecting;
- A statement of the Settlement Class Member’s objection or objections and the specific reasons for each objection, including any legal and evidentiary support the Settlement Class Member wishes to bring to the Court’s attention;
- Documents sufficient to prove the objector’s membership in the Settlement Class such as transaction dates and supporting records of HIIQ Securities that the objecting Settlement Class Member purchased or otherwise acquired during the relevant period; and
- Be signed by the objector;
The Court Lead Counsel Defendants' Counsel United States District Court
Middle District of Florida
Sam M. Gibbons Courthouse, Clerk’s Office
801 North Florida Avenue
Tampa, FL 33602
KAHN SWICK & FOTI, LLC
1100 Poydras Street
New Orleans, LA 70163
Robert F. Serio
GIBSON, DUNN & CRUTCHER LLP
200 Park Avenue
New York, NY 10166-0193
You may file a written objection without having to appear at the Settlement Hearing. You may not, however, appear at the Settlement Hearing to present your objection unless you first filed and served a written objection in accordance with the procedures described above, unless the Court orders otherwise.Back To Top
If I file an objection do I need to hire an attorney?
You are not required to hire an attorney to represent you in making written objections or in appearing at the Settlement Hearing. However, if you decide to hire an attorney, it will be at your own expense, and that attorney must file a notice of appearance with the Court and serve it on Lead Counsel and Defendants’ Counsel at the addresses set forth in FAQ 13 so that the notice is received on or before February 2, 2021.Back To Top
When will the Court decide whether to approve the Settlement?
The Settlement Hearing will be held on February 23, 2021, at 10:00 a.m., before the Honorable Thomas P. Barber, at the Sam M. Gibbons United States Courthouse, United States District Court for the Middle District of Florida, Courtroom 11B, 801 North Florida Avenue, Tampa, Florida 33602. The Court reserves the right to approve the Settlement, the Plan of Allocation, Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses, and/or any other matter related to the Settlement at or after the Settlement Hearing without further notice to the members of the Settlement Class. Please check this website for updatesBack To Top
Do I have to come to the hearing?
Settlement Class Members do not need to attend the Settlement Hearing.Back To Top
May I Speak At the Hearing If I Don't Like the Settlement?
If you wish to be heard orally at the Settlement Hearing in opposition to the approval of the Settlement, the Plan of Allocation, or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses, and if you file and serve a timely written objection, as described in FAQ 13, you must also file a Notice of Appearance. Notice of Appearances must be filed with the Clerk’s Office and served to Lead Counsel and Defendants’ Counsel at the addresses set forth in FAQ 13 so that it is received on or before February 2, 2021. Persons who intend to object and desire to present evidence at the Settlement Hearing must include the following in their written objection or Notice of Appearance: (a) the identity of any witnesses they may call to testify and (b) any exhibits they intend to introduce into evidence at the Settlement Hearing. Such persons may be heard orally at the discretion of the Court.Back To Top
What happens if I do nothing at all?
If you are a member of the Settlement Class and you do not submit a Proof of Claim and Release by April 8, 2021, or by a later date, if any, specified by the Court, you will not be eligible to receive any payment from the Settlement Fund. You will, however, remain a member of the Settlement Class, which means that you give up your right to sue about the claims that are resolved by the settlement, and you will be bound by any judgments or orders entered by the Court in the Litigation.Back To Top
How do I get more information?
This website and the Notice summarize the proposed Settlement. More details are available in the Stipulation of Settlement and other relevant documents, which are available on the Important Documents page. You can obtain answers to common questions regarding the proposed Settlement by contacting the Claims Administrator toll-free at 1-888-905-0951, via email at email@example.com, or by writing to:
In Re Health Insurance Innovations Securities Litigation
P.O. Box 2530
Portland, OR 97208-2530
Please do not contact the Court or Health Insurance Innovations or their Counsel for more information.Back To Top