Talkspace, Inc. (formerly Hudson Executive Investment Corporation)

According to the complaint, defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and prospects. Specifically, defendants allegedly failed to disclose to investors:

(a) that Talkspace was experiencing significantly increased online advertising costs in its B2C business since the beginning of 2021;
(b) that Talkspace was experiencing lower conversion rates in its online advertising in its B2C business;
(c) that, as a result of (a) and (b) above, Talkspace was experiencing increased customer acquisition costs and more tepid B2C demand than represented to investors;
(d) that, as a result of (a)-(c) above, Talkspace was suffering from ballooning customer acquisition costs and worsening growth and gross margin trends;
(e) that Talkspace had overvalued its accounts receivables from certain of its health plan clients in its B2B business, which amounts required adjusted downward; and
(f) that, as a result of (a)-(e) above, Talkspace’s 2021 financial guidance was not achievable and lacked any reasonable basis in fact.