In re Acadia Healthcare Company

UNITED STATES OF AMERICA 
Before the 
SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 100970 / September 9, 2024 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-22079 
 
In the Matter of 
 
 
Acadia Healthcare Company, Inc.,  
 
 
Respondent. 
 
 
 
 
ORDER INSTITUTING CEASE-AND-
DESIST PROCEEDINGS PURSUANT TO 
SECTION 21C OF THE SECURITIES 
EXCHANGE ACT OF 1934, MAKING 
FINDINGS, AND IMPOSING A CEASE-
AND-DESIST ORDER  
  
 
 
I. 
 
 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-
and-desist proceedings be, and hereby are, instituted pursuant to Section 21C of the Securities 
Exchange Act of 1934 (“Exchange Act”), against Acadia Healthcare Company, Inc. (“Acadia” or 
“Respondent”).  
 
II. 
 
 In anticipation of the institution of these proceedings, Acadia has submitted an Offer of 
Settlement (the “Offer”) which the Commission has determined to accept. Solely for the purpose of 
these proceedings and any other proceedings brought by or on behalf of the Commission, or to 
which the Commission is a party, and without admitting or denying the findings herein, except as 
to the Commission’s jurisdiction over it and the subject matter of these proceedings, which are 
admitted, Acadia consents to the entry of this Order Instituting Cease-and-Desist Proceedings 
Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing a 
Cease-and-Desist Order (“Order”), as set forth below.  
 
 
 
 
 
 
 

 2 
III. 
 
On the basis of this Order and Acadia’s Offer, the Commission finds that: 
 
 
Respondent 
 
1. Acadia, a Delaware corporation based in Franklin, Tennessee, develops and 
operates behavioral healthcare services and facilities across the United States. Acadia’s common 
stock is registered with the Commission pursuant to Section 12(b) of the Exchange Act and is 
listed on the Nasdaq Global Select Market under the ticker “ACHC.” 
 
Facts 
 
A.  Statutory and Regulatory Framework Protecting Whistleblowers 
 
2. The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank 
Act”), enacted on July 21, 2010, amended the Exchange Act by adding Section 21F, 
“Whistleblower Incentives and Protection.” The congressional purpose underlying these provisions 
was “to encourage whistleblowers to report possible violations of the securities laws by providing 
financial incentives, prohibiting employment-related retaliation, and providing various 
confidentiality guarantees.” See Implementation of the Whistleblower Provisions of Section 21F of 
the Securities Exchange Act of 1934, Release No. 34-64545, at p. 197 (Aug. 12, 2011). 
 
3. Congress explicitly noted the importance of providing financial incentives to 
promote whistleblowing to the Commission as it determined that “a critical component of the 
Whistleblower Program is the minimum payout that any individual could look towards in 
determining whether to take the enormous risk of blowing the whistle in calling attention to fraud.” 
See The Restoring American Financial Stability Act of 2010, Committee on Banking, Housing, and 
Urban Affairs (Apr. 30, 2010). 
 
4. To fulfill this congressional purpose, the Commission adopted Rule 21F-17, which 
provides in relevant part:  
 
(a)  No  person  may  take  any  action  to  impede  an  individual  from  communicating 
directly  with  the  Commission  staff  about  a  possible  securities  law  violation, 
including enforcing, or threatening to enforce, a confidentiality agreement . . . with 
respect to such communications. 
 
Rule 21F-17 became effective on August 12, 2011. 
 
 
 
 
 

 3 
B.  Acadia’s Employment, Separation, Retention, and Settlement Agreements 
 
5. As a regular part of its business, Acadia enters into employment agreements with 
new employees and separation agreements with departing employees. These agreements define the 
rights and responsibilities of the company and the employee during the employment relationship 
and after the employee’s departure.  
 
6. In 2022 and 2023, Acadia entered into retention agreements with certain 
employees. These agreements provided financial incentives to current employees and modified 
existing terms of their employment relationship with Acadia. 
 
7. From time to time, Acadia enters into settlement agreements with former 
employees. These settlement agreements are contracts that resolve an actual or potential legal 
dispute between the company and the former employee. 
 
8. Between July 31, 2019, and July 10, 2023, Acadia entered into ninety-eight 
agreements, including employment agreements, separation agreements, retention agreements, and 
settlement agreements, that required employees to waive their right to recover a monetary award 
for participating in an investigation by a government agency. The precise text of these provisions 
varied, but they were all substantially similar to the following example
1
: 
 
I  agree  that  I  hereby  waive  all  rights  to  sue  or  obtain  equitable,  remedial  or 
punitive relief from any or all Released Parties of any kind whatsoever in respect 
of  any  Claim,  including,  without  limitation,  reinstatement,  back  pay,  front  pay, 
and   any   form   of   injunctive   relief.   Notwithstanding   the   above, I   further 
acknowledge that I am not waiving and am not being required to waive any right 
that  cannot  be  waived  under  law,  including  the  right  to  file  an  administrative 
charge or participate in an administrative investigation or proceeding; provided, 
however,  that  I  disclaim  and  waive  any  right to  share  or  participate  in  any 
monetary   award   resulting   from   the   prosecution   of   such   charge   or 
investigation or proceeding. 
 
(Underline in original. Emphasis added.) 
 
9. Between December 5, 2019, and September 22, 2023, Acadia entered into an 
additional fifty-six separation and settlement agreements that required employees to waive their 
right to file a complaint with any federal government agency. The precise text of these provisions 
varied, but they were all substantially similar to the following example: 
 
[Employee] represents that  he  has  not  filed  any  complaints  or  charges  against  any 
of the Released Parties with any local, state or federal agency or court, that he will 
not  file any such complaints or charges arising out of or relating to events prior to 
the  execution  of  this  Agreement  and  that  if  any  such  agency  or  court  assumes 
                                                 
1
 Consistent with this example, the majority of the agreements expressly permitted participation in government 
whistleblower programs while also requiring employees to waive their right to a potential award. 

 4 
jurisdiction of any such complaint or charge against any of the Released Parties on 
behalf of Acadia, he will request such agency or court to withdraw from the matter 
and that the complaint or charge be dismissed.  
 
10. Although the Commission is unaware of any instances in which Acadia took action 
to enforce these provisions or in which the affected employees declined to speak with the 
Commission staff about potential violations of securities laws, these provisions created 
impediments to participation in the Commission’s whistleblower program by requiring employees 
to forego either their right to file a complaint with the Commission staff or the financial award they 
might receive for doing so.  
11. Through the conduct described above, Acadia violated Exchange Act Rule 21F-
17(a), which prohibits any person from taking any action to impede an individual from 
communicating directly with the Commission staff about a possible securities law violation. 
 
Remedial Actions and Cooperation 
  
12. Prior to being contacted by the Commission staff in connection with this matter, 
Acadia revised some of its relevant internal agreement templates to remove certain violative 
provisions and affirmatively advise employees that they are not prohibited from disclosing 
information to any governmental or regulatory authority, or from collecting any related incentive 
awards. After being contacted by the Commission staff, Acadia applied these changes to the rest of 
its agreement templates and also used reasonable efforts to notify the affected employees that their 
agreements do not in any way limit their ability to contact the Commission staff or to obtain an 
award in connection with information they provide. 
 
13. In determining to accept the Offer, the Commission considered remedial acts 
promptly undertaken by Acadia and cooperation afforded to the Commission staff. 
 
IV. 
 
 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 
agreed to in Acadia’s Offer. 
 
 Accordingly, it is hereby ORDERED that: 
 
 A. Pursuant to Section 21C of the Exchange Act, Acadia cease and desist from 
committing or causing any violations and any future violations of Exchange Act Rule 21F-17(a). 
 
B. Acadia shall, within ten days of the entry of this order, pay a civil money penalty in 
the amount of $1,386,000 to the Securities and Exchange Commission for transfer to the general 
fund of the United States Treasury, subject to Exchange Act Section 21F(g)(3). If timely payment 
is not made, additional interest shall accrue pursuant to 31 U.S.C. § 3717. 
 
 
 

 5 
 
Payment must be made in one of the following ways:  
 
(1) Respondent may transmit payment electronically to the Commission, which 
will provide detailed ACH transfer/Fedwire instructions upon request;  
 
(2) Respondent may make direct payment from a bank account via Pay.gov 
through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  
 
(3) Respondent may pay by certified check, bank cashier’s check, or United 
States postal money order, made payable to the Securities and Exchange 
Commission and hand-delivered or mailed to:  
 
Enterprise Services Center 
Accounts Receivable Branch 
HQ Bldg., Room 181, AMZ-341 
6500 South MacArthur Boulevard 
Oklahoma City, OK 73169 
 
Payments by check or money order must be accompanied by a cover letter identifying 
Acadia as a respondent in these proceedings, and the file number of these proceedings; a copy of 
the cover letter and check or money order must be sent to Nicholas P. Heinke, Associate Regional 
Director, Division of Enforcement, United States Securities and Exchange Commission, 1961 
Stout Street, Suite 1700, Denver, CO 80294. 
 
 C. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 
treated as penalties paid to the government for all purposes, including all tax purposes. To preserve 
the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor Action, it 
shall not argue that it is entitled to, nor shall it benefit by, offset or reduction of any award of 
compensatory damages by the amount of any part of Respondent’s payment of a civil penalty in 
this action (“Penalty Offset”). If the court in any Related Investor Action grants such a Penalty 
Offset, Respondent agrees that it shall, within thirty days after entry of a final order granting the 
Penalty Offset, notify the Commission’s counsel in this action and pay the amount of the Penalty 
Offset to the Securities and Exchange Commission. Such a payment shall not be deemed an 
additional civil penalty and shall not be deemed to change the amount of the civil penalty imposed 
in this proceeding. For purposes of this paragraph, a “Related Investor Action” means a private 
damages action brought against Respondent by or on behalf of one or more investors based on 
substantially the same facts as alleged in the Order instituted by the Commission in this 
proceeding. 
 
 By the Commission. 
 
 
Vanessa A. Countryman 
Secretary 

UNITED STATES OF AMERICA 

Before the 

SECURITIES AND EXCHANGE COMMISSION 

 

SECURITIES EXCHANGE ACT OF 1934 

Release No. 100970 / September 9, 2024 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-22079 

 

In the Matter of 

 

 

Acadia Healthcare Company, Inc.,  

 

 

Respondent. 

 

 

 

 

ORDER INSTITUTING CEASE-AND-

DESIST PROCEEDINGS PURSUANT TO 

SECTION 21C OF THE SECURITIES 

EXCHANGE ACT OF 1934, MAKING 

FINDINGS, AND IMPOSING A CEASE-

AND-DESIST ORDER  

  

 

 

I. 

 

 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-

and-desist proceedings be, and hereby are, instituted pursuant to Section 21C of the Securities 

Exchange Act of 1934 (“Exchange Act”), against Acadia Healthcare Company, Inc. (“Acadia” or 

“Respondent”).  

 

II. 

 

 In anticipation of the institution of these proceedings, Acadia has submitted an Offer of 

Settlement (the “Offer”) which the Commission has determined to accept. Solely for the purpose of 

these proceedings and any other proceedings brought by or on behalf of the Commission, or to 

which the Commission is a party, and without admitting or denying the findings herein, except as 

to the Commission’s jurisdiction over it and the subject matter of these proceedings, which are 

admitted, Acadia consents to the entry of this Order Instituting Cease-and-Desist Proceedings 

Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing a 

Cease-and-Desist Order (“Order”), as set forth below.  

 

 

 

 

 

 

 



 2 

III. 

 

On the basis of this Order and Acadia’s Offer, the Commission finds that: 

 

 

Respondent 

 

1. Acadia, a Delaware corporation based in Franklin, Tennessee, develops and 

operates behavioral healthcare services and facilities across the United States. Acadia’s common 

stock is registered with the Commission pursuant to Section 12(b) of the Exchange Act and is 

listed on the Nasdaq Global Select Market under the ticker “ACHC.” 

 

Facts 

 

A.  Statutory and Regulatory Framework Protecting Whistleblowers 

 

2. The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank 

Act”), enacted on July 21, 2010, amended the Exchange Act by adding Section 21F, 

“Whistleblower Incentives and Protection.” The congressional purpose underlying these provisions 

was “to encourage whistleblowers to report possible violations of the securities laws by providing 

financial incentives, prohibiting employment-related retaliation, and providing various 

confidentiality guarantees.” See Implementation of the Whistleblower Provisions of Section 21F of 

the Securities Exchange Act of 1934, Release No. 34-64545, at p. 197 (Aug. 12, 2011). 

 

3. Congress explicitly noted the importance of providing financial incentives to 

promote whistleblowing to the Commission as it determined that “a critical component of the 

Whistleblower Program is the minimum payout that any individual could look towards in 

determining whether to take the enormous risk of blowing the whistle in calling attention to fraud.” 

See The Restoring American Financial Stability Act of 2010, Committee on Banking, Housing, and 

Urban Affairs (Apr. 30, 2010). 

 

4. To fulfill this congressional purpose, the Commission adopted Rule 21F-17, which 

provides in relevant part:  

 

(a) No person may take any action to impede an individual from communicating 

directly with the Commission staff about a possible securities law violation, 

including enforcing, or threatening to enforce, a confidentiality agreement . . . with 

respect to such communications. 

 

Rule 21F-17 became effective on August 12, 2011. 

 

 

 

 

 



 3 

B.  Acadia’s Employment, Separation, Retention, and Settlement Agreements 

 

5. As a regular part of its business, Acadia enters into employment agreements with 

new employees and separation agreements with departing employees. These agreements define the 

rights and responsibilities of the company and the employee during the employment relationship 

and after the employee’s departure.  

 

6. In 2022 and 2023, Acadia entered into retention agreements with certain 

employees. These agreements provided financial incentives to current employees and modified 

existing terms of their employment relationship with Acadia. 

 

7. From time to time, Acadia enters into settlement agreements with former 

employees. These settlement agreements are contracts that resolve an actual or potential legal 

dispute between the company and the former employee. 

 

8. Between July 31, 2019, and July 10, 2023, Acadia entered into ninety-eight 

agreements, including employment agreements, separation agreements, retention agreements, and 

settlement agreements, that required employees to waive their right to recover a monetary award 

for participating in an investigation by a government agency. The precise text of these provisions 

varied, but they were all substantially similar to the following example1: 

 

I agree that I hereby waive all rights to sue or obtain equitable, remedial or 

punitive relief from any or all Released Parties of any kind whatsoever in respect 

of any Claim, including, without limitation, reinstatement, back pay, front pay, 

and any form of injunctive relief. Notwithstanding the above, I further 

acknowledge that I am not waiving and am not being required to waive any right 

that cannot be waived under law, including the right to file an administrative 

charge or participate in an administrative investigation or proceeding; provided, 

however, that I disclaim and waive any right to share or participate in any 

monetary award resulting from the prosecution of such charge or 

investigation or proceeding. 

 

(Underline in original. Emphasis added.) 

 

9. Between December 5, 2019, and September 22, 2023, Acadia entered into an 

additional fifty-six separation and settlement agreements that required employees to waive their 

right to file a complaint with any federal government agency. The precise text of these provisions 

varied, but they were all substantially similar to the following example: 

 

[Employee] represents that he has not filed any complaints or charges against any 

of the Released Parties with any local, state or federal agency or court, that he will 

not file any such complaints or charges arising out of or relating to events prior to 

the execution of this Agreement and that if any such agency or court assumes 

                                                 
1 Consistent with this example, the majority of the agreements expressly permitted participation in government 

whistleblower programs while also requiring employees to waive their right to a potential award. 



 4 

jurisdiction of any such complaint or charge against any of the Released Parties on 

behalf of Acadia, he will request such agency or court to withdraw from the matter 

and that the complaint or charge be dismissed.  

 

10. Although the Commission is unaware of any instances in which Acadia took action 

to enforce these provisions or in which the affected employees declined to speak with the 

Commission staff about potential violations of securities laws, these provisions created 

impediments to participation in the Commission’s whistleblower program by requiring employees 

to forego either their right to file a complaint with the Commission staff or the financial award they 

might receive for doing so.  

11. Through the conduct described above, Acadia violated Exchange Act Rule 21F-

17(a), which prohibits any person from taking any action to impede an individual from 

communicating directly with the Commission staff about a possible securities law violation. 

 

Remedial Actions and Cooperation 

  

12. Prior to being contacted by the Commission staff in connection with this matter, 

Acadia revised some of its relevant internal agreement templates to remove certain violative 

provisions and affirmatively advise employees that they are not prohibited from disclosing 

information to any governmental or regulatory authority, or from collecting any related incentive 

awards. After being contacted by the Commission staff, Acadia applied these changes to the rest of 

its agreement templates and also used reasonable efforts to notify the affected employees that their 

agreements do not in any way limit their ability to contact the Commission staff or to obtain an 

award in connection with information they provide. 

 

13. In determining to accept the Offer, the Commission considered remedial acts 

promptly undertaken by Acadia and cooperation afforded to the Commission staff. 

 

IV. 

 

 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 

agreed to in Acadia’s Offer. 

 

 Accordingly, it is hereby ORDERED that: 

 

 A. Pursuant to Section 21C of the Exchange Act, Acadia cease and desist from 

committing or causing any violations and any future violations of Exchange Act Rule 21F-17(a). 

 

B. Acadia shall, within ten days of the entry of this order, pay a civil money penalty in 

the amount of $1,386,000 to the Securities and Exchange Commission for transfer to the general 

fund of the United States Treasury, subject to Exchange Act Section 21F(g)(3). If timely payment 

is not made, additional interest shall accrue pursuant to 31 U.S.C. § 3717. 

 

 

 



 5 

 

Payment must be made in one of the following ways:  

 

(1) Respondent may transmit payment electronically to the Commission, which 

will provide detailed ACH transfer/Fedwire instructions upon request;  

 

(2) Respondent may make direct payment from a bank account via Pay.gov 

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  

 

(3) Respondent may pay by certified check, bank cashier’s check, or United 

States postal money order, made payable to the Securities and Exchange 

Commission and hand-delivered or mailed to:  

 

Enterprise Services Center 

Accounts Receivable Branch 

HQ Bldg., Room 181, AMZ-341 

6500 South MacArthur Boulevard 

Oklahoma City, OK 73169 

 

Payments by check or money order must be accompanied by a cover letter identifying 

Acadia as a respondent in these proceedings, and the file number of these proceedings; a copy of 

the cover letter and check or money order must be sent to Nicholas P. Heinke, Associate Regional 

Director, Division of Enforcement, United States Securities and Exchange Commission, 1961 

Stout Street, Suite 1700, Denver, CO 80294. 

 

 C. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 

treated as penalties paid to the government for all purposes, including all tax purposes. To preserve 

the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor Action, it 

shall not argue that it is entitled to, nor shall it benefit by, offset or reduction of any award of 

compensatory damages by the amount of any part of Respondent’s payment of a civil penalty in 

this action (“Penalty Offset”). If the court in any Related Investor Action grants such a Penalty 

Offset, Respondent agrees that it shall, within thirty days after entry of a final order granting the 

Penalty Offset, notify the Commission’s counsel in this action and pay the amount of the Penalty 

Offset to the Securities and Exchange Commission. Such a payment shall not be deemed an 

additional civil penalty and shall not be deemed to change the amount of the civil penalty imposed 

in this proceeding. For purposes of this paragraph, a “Related Investor Action” means a private 

damages action brought against Respondent by or on behalf of one or more investors based on 

substantially the same facts as alleged in the Order instituted by the Commission in this 

proceeding. 

 

 By the Commission. 

 

 

Vanessa A. Countryman 

Secretary 

http://www.sec.gov/about/offices/ofm.htm

	UNITED STATES OF AMERICA
	IV.