Strougo v. Tivity Health Inc. et al.

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Judge granted the defendants’ motion to exclude plaintiff’s damages expert in this securities litigation.

Retained by King & Spalding

In this securities class action, the plaintiff alleged Tivity Health and its executives made false and misleading statements regarding the performance of the company’s recently acquired subsidiary. Defense counsel retained Cornerstone Research to support Paul Gompers of Harvard Business School and Cathy Hwang of the University of Virginia Law School as expert witnesses.

In its opinion, the court echoed critiques made in Professor Gompers’ report and testimony.

Professor Gompers rebutted plaintiff’s damages expert’s opinions. Professor Gompers submitted a rebuttal report at the merits stage of the matter in February 2023 and testified at the Daubert hearing in May 2025.

Three weeks before trial was set to begin, the U.S. district court for the Middle District of Tennessee judge granted the defendants’ motion to exclude plaintiff’s damages expert. In its opinion, the court found that plaintiff’s expert “repeatedly emphasized that he did not confirm that the information revealed had been concealed by Defendants’ alleged fraud, but instead he made an ‘assumption’ of the liability Lead Plaintiff seeks to prove. Based on that assumption, he labels any negative information about the Nutrition segment a ‘corrective’ disclosure, and attributes all losses to the revelation of fraud because Lead Plaintiff says so…. [He] fails to properly deploy any reliable methodology based on sufficient data about the market to analyze whether there were any non-fraudulent factors within the Corrective Disclosure contributing to a drop in Tivity’s stock,” echoing critiques made in Professor Gompers’ report and testimony.


For more information, contact Sasha Aganin or Heather Lazur. Other team members include Samer Semaan and Matt Davis.


Case Experts

Paul A. Gompers

Paul A. Gompers

Eugene Holman Professor of Business Administration,
Harvard Business School,
Harvard University

Cathy Hwang

Cathy Hwang

Professor of Law,
University of Virginia School of Law