Case Summary

HireRight Holdings

NYSE: HRT

Case Details

  • Deutsch v. HireRight Holdings Corporation et al.
  • Class Period:October 26, 2021 - April 02, 2024
  • Date Filed:April 02, 2024
  • Jurisdiction:U.S. District Court, Middle District of Tennessee
  • Docket Number: 3:24-cv-00371
  • Lead Plaintiff Deadline: June 3, 2024
Days Left to
Seek Plaintiff
9

Overview

A class action lawsuit has been filed against HireRight Holdings Corporation (“HireRight” or the “Company”) (NYSE: HRT) and certain of the Company’s current and former senior executive officers alleging violations of the Securities Exchange Act of 1934.  The HireRight lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired HireRight securities pursuant and/or traceable to the Offering Documents issued in connection with HireRight’s October 2021 Initial Public Offering (the “IPO”) (the “Class Period”) and investors have until June 3, 2024, to seek appointment as lead plaintiff of the HireRight class action lawsuit.

HireRight provides technology-driven workforce risk management and compliance solutions to a customer base characterized as a diverse set of organizations, from large-scale multinational businesses to small- and medium-sized businesses, across a broad range of industries.  The Company offers background screening, verification, identification, monitoring, and drug and health screening services for customers under the HireRight brand name and boasts a purportedly robust pipeline of opportunities developed by its sales team to continue to attract new customers and take share in the market.

On October 6, 2021, HireRight filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission (“SEC”) in connection with the IPO, which, after an amendment, was declared effective by the SEC on October 28, 2021 (the “Registration Statement”).  On November 1, 2021, HireRight filed a prospectus on Form 424B4 with the SEC in connection with the IPO, which incorporated and formed part of the Registration Statement (the “Prospectus” and, collectively with the Registration Statement, the “Offering Documents”).  That same day, pursuant to the Offering Documents, HireRight’s common stock began publicly trading on the New York Stock Exchange under the ticker symbol HRT.  Pursuant to the Offering Documents, HireRight issued approximately 22 million shares of its common stock to the public at the offering price of $19.00 per share for proceeds to the Company of approximately $399 million after applicable underwriting discounts and commissions, and before expenses.

The Offering Documents were negligently prepared and, as a result, contained untrue statements of material fact or omitted to state other facts necessary to make the statements made not misleading and were not prepared in accordance with the rules and regulations governing its preparation.  Specifically, the Offering Documents made false and/or misleading statements and/or failed to disclose that: (1) HireRight was exposed to customers with significant employment and hiring risk and the Company derived greater revenue growth from existing client hiring than from new client hiring; (2) as a result, the Company’s revenue growth was unsustainable to the extent that it relied on the stability of its current customers’ hiring and/or the profitability of securing new customers; (3) accordingly, HireRight had overstated its post-IPO business and/or prospects; and (4) as a result, Defendants’ statements about the Company’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.

On January 19, 2023, Stifel, a brokerage and investment banking firm, downgraded HireRight’s stock from a Hold to a Buy, prompting several market analysts to issue publications discussing the downgrade.  For example, Seeking Alpha reported that Stifel found HireRight to be exposed to large technology firms where there is more acute employment and hiring risk, and that more of the Company’s growth comes from existing client hiring than from new.  On this news, HireRight’s stock price fell $0.88 per share, or 7.5%, to close at $10.75 per share on January 19, 2023.  At the time of the filing of the  complaint, HireRight’s common stock continued to trade below the $19.00 per share IPO price.  As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of HireRight’s securities, Plaintiff and other Class members have suffered significant losses and damages.

*          *          *

If you purchased or otherwise acquired HireRight securities pursuant and/or traceable to the Offering Documents issued in connection with HireRight’s October 2021 Initial Public Offering, and suffered substantial losses, and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at investors@dicellolevitt.com. 

The deadline to apply to the Court to serve as a lead plaintiff in the HireRight lawsuit is June 3, 2024.

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