Clover Health enters agreement to settle securities class action litigation

Clover Health Investments announced that the Company has reached an agreement to resolve the securities class action captioned Bond v. Clover Health Investments, Corp. et al., Case No. 3:21-CV-00096, which was filed in the wake of its de-SPAC transaction. The proposed settlement contains no admission of liability or wrongdoing by any of the defendants, including the Company, and is subject to definitive documentation and final court approval. On April 21, 2023, the parties to the securities class action entered into a memorandum of understanding providing for the settlement of the class action. Subject to negotiation of definitive documentation and final court approval, the class will receive $22 million dollars, the defendants will receive customary releases, and the litigation will be concluded. The Company will use insurance proceeds totaling $19.5 million that have been advanced or have been committed to be advanced by the Company’s insurers to fund the settlement. The Company expects to pay $2.5 million of out-of-pocket costs to fund the settlement. The Company previously filed a lawsuit in Delaware state court against certain of its insurers for full payment of its liabilities related to this securities litigation. The Company intends to continue to pursue that litigation against the insurance carrier defendants to seek to recover additional funds, and intends to oppose any efforts by the carrier defendants to recoup any insurance proceeds that they have advanced or committed to advance to date. This settlement is subject to definitive documentation and final court approval. The defendants have denied all wrongdoing and have entered into this settlement to avoid the burden, expense, and distraction of ongoing litigation. Further information on the settlement will be available upon the filing of the formal notice of settlement to class members, and the above descriptions of the settlement is qualified entirely by the definitive settlement papers and corresponding notice.