Trinet (TNET) Securities Fraud Class Action Lawsuit

This lawsuit alleges that TriNet did not properly model medical and insurance costs for its workers compensation services, thereby overstating revenues and net income for the time period in question.  What makes these allegations partially troubling is that the industry as a whole seemed to be adjusting costs upward at a time when the company was assuring investors it did not need to do the same.

TriNet provides bundled HR outsourcing services to medium size companies.  These bundled services include services such as payroll processing, human capital consulting, employment law compliance and employee benefits, including health insurance, retirement plans and workers compensation insurance.  For health insurance and workers compensation services, the company does buy some third party insurance but also assumes some of the risk itself so forecasting future claims is critical to predict future revenues and net income.

This lawsuit alleges that TriNet made false and misleading statements or failed to disclose adverse events for fiscal 2014 and 2015, including the following:

TriNet’s processes and methodologies for analyzing and accruing claims failed to properly account for historical claims trends;

TriNet’s forecasting process failed to properly incorporate relevant historical and current claims trends;

TriNet was experiencing growing claims trends in medical and workers compensation that negatively affected the Company’s current and future business prospects; and

In light of the above, TriNet’s publicly stated financial outlook did not have a reasonable basis.

Article Type: Lawsuit
Topic: Investments

Most Recent Case Event

Court creates leadership structure

December 3, 2015

Here is the court order creating the leadership structure.

trinet_-_order_appointing_lead_plaintff.pdf

Case Event History

Shareholder files complaint against TriNet

August 10, 2015

Here is the initial complaint.  It will be amended once the leadership structure is established.

trinet_securities_fraud_complaint.pdf

Small shareholder moves for leadership position

October 6, 2016

Single shareholder with maybe $3,500 in losses moves for lead plaintiff position.  He is the only moving shareholder.

trinet_-_motion_for_lead_counsel.pdf

Court creates leadership structure

December 3, 2015

Here is the court order creating the leadership structure.

trinet_-_order_appointing_lead_plaintff.pdf
Tags: Inaccurate Financial Forecasts, Securities Frauds, Stock Losses, Your Money