Robbins LLP: Foundation Medicine, Inc. (FMI) Misled Shareholders According to a Recently Filed Class Action
Robbins LLP announces that a class action complaint was filed against Foundation Medicine, Inc. (NasdaqGS: FMI) in the U.S. District Court for the District of Massachusetts. The complaint is brought on behalf of all purchasers of Foundation securities between February 26, 2014 and November 3, 2015, for alleged violations of the Securities Exchange Act of 1934 by Foundation’s officers and directors. Foundation develops, manufactures, and sells genomic analysis diagnostics for solid and circulating cancers.
Foundation Accused of Making Reckless Financial Projections
According to the complaint, Foundation officials misled investors regarding the Medicare reimbursement process for its tumor tests. In addition, the company reported strong 2015 financial guidance that allegedly caused its shares to trade at inflated prices. On July 29, 2015, Foundation disclosed that it would not be reimbursed by Medicare due to a delay in receiving a local coverage determination from its regional Medicare Administrative Contractor. As a result, Foundation slashed its previously projected revenues and revised the expected volume of clinical tests downward, causing the company’s stock to decline approximately 24%, or $7 per share. Then, on November 3, 2015, Foundation disclosed a further downward revision to its expected volume of clinical tests. On this news, Foundation’s stock fell another 27.6%, or $6.62 per share, to close at $17.31 per share on November 4, 2015.
Foundation Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Leonid Kandinov at (800) 350-6003, or you can complete the form below and we will contact you directly.