Securities Litigation Partner James (Josh) Wilson Encourages Investors Who Suffered Losses Exceeding $50,000 In Eargo To Contact Him Directly To Discuss Their Options
Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Eargo, Inc. (“Eargo” or the “Company”) (NASDAQ: EAR) and reminds investors of the December 6, 2021 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you suffered losses exceeding $50,000 investing in Eargo stock or options between February 25, 2021 and September 22, 2021 and would like to discuss your legal rights, Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310).
There is no cost or obligation to you.
Faruqi & Faruqi is a leading minority and Woman-owned national securities law firm with offices in New York, Delaware, Pennsylvania, California and Georgia.
As detailed below, the lawsuit focuses on whether the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1) Eargo had improperly sought reimbursements from certain third-party payors; (2) the foregoing was reasonably likely to lead to regulatory scrutiny; (3) as a result and because the reimbursements at issue involved the Company’s largest third-party payor, Eargo’s financial results would be adversely impacted; and (4) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
On August 12, 2021, after the market closed, Eargo revealed that claims submitted to the Company’s largest third-party payor, which accounted for 80% of Eargo’s accounts receivable, had not been paid since March 1, 2021.
On this news, the Company’s share price fell $8.00, or over 24%, to close at $24.70 per share on August 13, 2021, on unusually heavy trading volume.
On September 22, 2021, after market hours, Eargo disclosed that “it is the target of a criminal investigation by the U.S. Department of Justice (the ‘DOJ’) related to insurance reimbursement claims the Company has submitted on behalf of its customers covered by federal employee health plans.” The Company further stated that “[a]s previously disclosed, the Company has been the subject of an ongoing claims audit by an insurance company that is the Company’s largest third-party payor. The Company has been informed by the insurance company that the DOJ is now the principal contact related to the subject matter of the audit.” Finally, the Company announced that it “is withdrawing its financial guidance for the fiscal year ending December 31, 2021.”
On this news, Eargo’s shares fell approximately 60% during after-hours trading on September 22, 2021 and pre-market trading September 23, 2021, damaging investors.
* The submission of this form does not create an attorney-client relationship.
Filed on 09/23/2021
Class period 02/25/2021 - 09/22/2021
Lead Plaintiff Deadline 12/06/2021
40 days remaining
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