SelectQuote (SLQT) Faces Investor Securities Class Action After Stock Dropped 19% Amid Department of Justice Alleges False Claims Act Violations

Core Viewpoint - SelectQuote (NYSE: SLQT) faces a securities class action lawsuit following a significant drop in share price after the U.S. Department of Justice (DOJ) intervened in a lawsuit alleging illegal kickbacks and misleading business practices [1][4]. Group 1: Lawsuit Details - The class action lawsuit, Pahlkotter v. SelectQuote, Inc. et al., seeks to represent investors who acquired SelectQuote securities between September 9, 2020, and May 1, 2025 [1][2]. - The lawsuit focuses on SelectQuote's disclosures regarding its sales practices, particularly in its Senior business offering Medicare Advantage plans [2]. Group 2: Allegations Against SelectQuote - The DOJ's complaint alleges that from 2016 to at least 2021, SelectQuote received "tens of millions of dollars" in illegal kickbacks from health insurers for directing Medicare beneficiaries to specific plans [4]. - SelectQuote is accused of failing to provide unbiased comparisons of Medicare plans and instead directing beneficiaries to plans that compensated the company the most, regardless of quality [4][6]. - The company allegedly did not comply with applicable laws and regulations, making it vulnerable to sanctions, including violations of the federal False Claims Act [6]. Group 3: Impact on Share Price - Following the DOJ's announcement on May 1, 2025, SelectQuote's shares plummeted by 19% and have continued to decline amid ongoing legal challenges [1][5].