Insurer Bright Health Defeats Investor Suit Over Backlog (1)

Bright Health Group Inc. investors can’t proceed with a suit alleging that the health insurance company and its leaders misled them before and after its initial public offering about its ability to process claims and assess costs, a federal court ruled.

The proposed class action didn’t adequately allege false or misleading IPO registration or prospectus statements about Bright Health’s backlog of insurance claims and the resulting effect on its ability to understand its members’ health risks, Judge LaShann DeArcy Hall said Nov. 1 for the US District Court for the Eastern District of New York.

The plaintiffs also failed to ...