Caption: In re agilon health, inc. Securities Litigation
Case No.: 1:24-cv-297-DAE
Jurisdiction: U.S. District Court, Western District of Texas (Austin Division)
Judge: Hon. David Alan Ezra
Summary
On August 15, 2025, Judge David Alan Ezra ruled on several motions to dismiss in the securities case against agilon health, inc. The Court granted some requests and denied others. Parts of the lawsuit were thrown out, but other claims remain and will move forward.
Allegations Against agilon health
The case was filed on behalf of investors who bought agilon common stock between April 15, 2021, and February 27, 2024. It also covers people who purchased stock tied to agilon’s April 2021 IPO and later offerings in September 2021 and May 2023.
Plaintiffs alleged that agilon and its leaders presented the company’s business model as strong and dependable. They said agilon described its “Total Care Model” as unique and able to predict and manage costs, while in reality the company was struggling with data problems and could not track expenses accurately. Plaintiffs also said that agilon spoke about visibility into financial margins and future growth, but those statements were misleading because the company did not have reliable systems to integrate payor data.
The complaint connected these alleged misstatements to later disclosures. In November 2023, agilon cut its outlook and revealed higher patient utilization. In January 2024, agilon again lowered its forecast, reported utilization up sharply from the prior year, and announced its CFO was retiring. In February 2024, agilon admitted it had overstated margins, slowed membership growth, and cut guidance again. By the end of the Class Period, agilon’s stock price had dropped substantially.
Defendants’ Motions to Dismiss
The agilon defendants—including the company itself, certain executives, and directors—asked the Court to dismiss both the Securities Act and Exchange Act claims. They argued plaintiffs had not pleaded falsity or scienter with enough detail.
The underwriter defendants, which included J.P. Morgan, Goldman Sachs, BofA Securities, Wells Fargo, Deutsche Bank, Cowen, Nomura, RBC Capital Markets, Leerink, Truist, William Blair, and others, moved to dismiss all Securities Act claims.
The CD&R defendants, which included CD&R, Vector, affiliated entities, and individual directors, also filed a motion. They asked the Court to dismiss Securities Act claims, control-person claims under Section 20(a), and insider trading claims under Section 20A.
Plaintiffs’ Opposition
Plaintiffs opposed all three motions. They said the complaint identified false and misleading statements in offering documents, earnings calls, and public filings. They argued that the allegations met the pleading requirements and that the case should go forward.
Court’s Ruling
Judge Ezra issued a mixed ruling:
- Agilon Defendants: Motion granted in part and denied in part. The Court dismissed Section 11 and Section 15 Securities Act claims. It also dismissed Section 10(b) Exchange Act claims based on statements about data integration, growth strategy, and statements by defendants Hittner and Venkatachaliah. But the Court allowed Section 10(b) claims based on guidance, the business model, utilization trends, and historical financial reporting to proceed.
- Underwriter Defendants: Motion granted in full. The Court dismissed all Securities Act claims (Sections 11 and 12(a)(2)) against them, without prejudice.
- CD&R Defendants: Motion granted in part and denied in part. The Court dismissed Section 11 and Section 15 Securities Act claims, and dismissed Section 20(a) control-person claims for statements made after May 2023. But it allowed Section 20(a) claims for statements made on or before May 2023 and allowed insider trading claims under Section 20A against CD&R and Sell to continue.
Court’s Rationale
For the Securities Act claims, the Court found that agilon’s statements about its business model, financial visibility, and data management were not actionable. The Court said they were either generalized optimism or accompanied by risk disclosures. Because of that, the Section 11 and Section 15 claims failed.
For the Exchange Act claims, the Court dismissed those tied to data integration and growth strategy, as well as claims against Hittner and Venkatachaliah. But the Court found that plaintiffs had sufficiently alleged falsity and scienter regarding agilon’s guidance, its statements about the business model, utilization trends, and historical reporting. Those claims will continue.
For the underwriters, the Court held that the complaint did not plead an actionable false statement in the offering documents. All Securities Act claims against the underwriters were dismissed.
For the CD&R defendants, the Court dismissed Securities Act claims and Section 20(a) claims for statements made after May 2023. But it allowed Section 20(a) claims for earlier statements to proceed, and it also allowed the insider trading claim under Section 20A against CD&R and Sell, tied to the large May 2023 stock sale, to continue.
Case Status
The case is ongoing. The Court dismissed certain claims without prejudice, meaning they could be repleaded. Other claims—including Exchange Act claims against agilon and insider trading claims against CD&R and Sell—remain active and will proceed.
