A securities class action has been filed against Nutex Health Inc. (NUTX) on behalf of a class consisting of all persons and entities other than Defendants that purchased or otherwise acquired Nutex securities between August 8, 2024 through August 14, 2025. This case has been filed in the USDC – SDTX.
Nutex is a physician-led, healthcare services and operations company that began publicly trading via a reverse merger in April 2022. The Company operates through three divisions: a hospital division comprised of 24 hospital facilities in 11 states, a population health management division, and real estate. Nutex generally operates as an out-of-network provider and generates revenue, in part, from contracts with patients and, in most cases, a third-party payor such as commercial insurance, workers compensation insurance or, in limited cases, Medicare or Medicaid. According to Nutex, on average, greater than 90% of its net patient service revenue is paid by third-party payors.
Prior to 2022, if a patient with health insurance received care from an out-of-network provider, even unknowingly, the patient’s health plan might not have covered the entire out-of-network cost, leaving the patient with higher costs than if the care had come from an in-network provider. In addition to any out-of-network cost sharing the patient might have owed, the out-of-network provider could bill the patient for the difference between the billed charge and the amount the patient’s health plan paid, unless banned by state law-a practice called “balance billing”. An unexpected balance bill from an out-of-network provider is frequently referred to as a “surprise bill”.
At all relevant times, the Company has identified material weaknesses in its internal control over financial reporting. Specifically, Nutex has acknowledged that it had “ineffective design, implementation, and operation controls over logical access, program change management, and vendor management controls,” that “business process controls across all financial reporting processes were not effectively designed and implemented to properly address the risk of material misstatement, including controls without proper segregation of duties between preparer and reviewer and key management review controls,” and “ineffective design and implementation of controls over the completeness and accuracy of information included in key spreadsheets supporting the financial statements.” However, Nutex has consistently represented that it has “started the process of designing and implementing effective internal control measures to remediate the reported material weaknesses.”
The Complaint alleges that, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) HaloMD was achieving lucrative arbitration results for Nutex by engaging in a coordinated scheme to defraud insurance companies; (ii) as a result, to the extent that they were the product of fraudulent conduct, revenues attributable to the Company’s engagement with HaloMD in the IDR process were unsustainable; (iii) in addition, the Company overstated the extent to which it had remediated, and/or its ability to remediate, the material weaknesses in its internal controls over financial reporting; (iv) as a result, the Company was unable to effectively account for the treatment of certain of its stock based compensation obligations; (v) as a result, Nutex improperly calculated these stock based compensation obligations as equity rather than liabilities; (vi) the foregoing increased the risk that the Company would be unable to timely file certain financial reports with the United States Securities and Exchange Commission (“SEC”); (vii) accordingly, Nutex’s business and/or financial prospects were overstated; and (viii) as a result, Defendants’ public statements were materially false and misleading at all relevant times.