Girard Sharp LLP announces investigation into potential fiduciary duty claims on behalf of shareholders of Talkspace, Inc.

Girard Sharp LLP and Malmfeldt Law Group PC announce an investigation into a potential breach of fiduciary duty claims on behalf of stockholders of Talkspace, Inc. (“Talkspace” or the “Company”) (Nasdaq: TALK). Talkspace began as Hudson Executive Investment Corporation (“HEIC”), a blank check company (also known as a Special Purpose Acquisition Company, or SPAC). Prior to the company’s merger with Talkspace in June 2021, the company’s directors issued a proxy that urged shareholders to vote in favor of the merger. The agent may have misrepresented the business, finances and prospects of the Company. Additionally, in recommending the merger, the directors of the company had conflicting interests because they held non-redeemable founder shares of the company that would only be converted into value shares of the Class A company if the company completed a merger. .

If you purchased Company stock prior to the merger with Talkspace and would like to discuss your recovery options, please provide your information by clicking here. You can also contact attorney Adam Polk of Girard Sharp by calling (415) 981-4800 or by email at [email protected], or attorney Paul Malmfeldt of Malmfeldt Law Group by calling (312) 606 -8625 or by e-mail to [email protected]

Investigation: Girard Sharp and Malmfeldt Law Group are investigating whether the final proxy statement seeking shareholder approval of the merger with Talkspace may have misrepresented its business, financials and outlook, omitting, among other things, that: (i ) Talkspace was experiencing a significant increase in online sales and ad spend in its B2C business since early 2021; (ii) Talkspace was experiencing lower conversion rates in its online advertising in its B2C business; (iii) Talkspace was experiencing rising customer acquisition costs and weaker B2C demand than represented to investors; (iv) Talkspace was suffering from increased customer acquisition costs and deteriorating growth and gross margin trends; and (v) Talkspace had overstated its accounts receivable from some of its health plan customers in its B2B business, the amounts of which required downward adjustment.

On August 9, 2021, Talkspace disclosed certain issues related to increased customer acquisition costs due to rising digital advertising costs while minimizing their impact, and confirmed a significant increase in customer acquisition costs. customers since the beginning of the year. At this news, Talkspace’s share price fell nearly 19%. Subsequently, on November 15, 2021, Talkspace issued a press release announcing Talkspace’s third quarter 2021 financial results and disclosing, among other things, that “[i]In the third quarter, we increased the provision for credit losses by $3.4 million, including $2.8 million related to prior quarters” and that “net sales in the third quarter were lower management’s expectations due to a lower number of B2C customers and a non-cash reserve adjustment for credit losses on receivables related to prior periods.” Talkspace also announced that day that with With immediate effect, Talkspace Co-Founder, CEO and Board Member Defendant Oren Frank was resigning, and his wife Roni Frank was also resigning as Chief Clinical Services Officer and Board Member. administration. On this news, Talkspace’s share price fell more than 36%, further hurting investors.

As of December 30, 2021, the price of Talkspace common stock was trading below $2 per share, 80% below the price shareholders would have received had they redeemed their shares instead of approving the merger less than one year earlier.

ABOUT GIRARD SHARP LLP: Girard Sharp LLP is a national litigation firm representing plaintiffs in class and class actions in federal and state courts. The firm serves individuals, institutions and corporate clients in matters involving securities, antitrust, consumer protection and whistleblower laws. Our clients range from individual consumers and small businesses to Fortune 100 companies and public pension funds. Our attorneys have recovered over $1 billion for our clients against some of the nation’s largest corporations, such as Raymond James, Peregrine Financial Group and Oppenheimer Funds, in cases related to securities fraud, false advertising and other unfair business practices. Girard Sharp was recognized as a Tier 1 law firm for class action plaintiffs in the list of “Best Law Firms” in the survey published in US News and World Reports Money issue. Law360 named Girard Sharp as one of its Product Responsibility Groups of the Year for 2021. In 2020, Girard Sharp was honored with the Daily newspaper “California’s Best Shops” award. The National Law Review (NLJ) also named Girard Sharp to its elite “Plaintiffs’ Hot List,” a selection of America’s top plaintiff firms recognized for their victories in high-profile cases.

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