The U.S. Department of Justice is Investigating Fulgent Genetics, Inc. (FLGT) for Violations of the Anti-Kickback Statute and the Stark Law
A shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired Fulgent Genetics, Inc. (NASDAQ: FLGT) securities between March 22, 2019 and August 4, 2022, for violations of the Securities Exchange Act of 1934. Fulgent provides COVID-19, molecular diagnostic, and genetic testing services to physicians and patents in the U.S. and internationally.
According to the complaint, during the class period, defendants failed to disclose that: (i) Fulgent had been conducting medically unnecessary laboratory testing, engaging in improper billing practices in relation to laboratory testing, and providing or receiving remuneration in violation of the Anti-Kickback Statute and Stark Law; (ii) accordingly, Fulgent was likely to become subject to enhanced legal and regulatory scrutiny; and (iii) Fulgent’s revenues, to the extent they were derived from the foregoing unlawful conduct, were unsustainable.
On August 4, 2022, Fulgent released its second quarter 2022 financial results, disclosing that the SEC was conducting an investigation into certain of the Company’s reports filed with the SEC from 2018 through the first quarter 2020. The disclosure followed the Company’s receipt of a civil investigative demand issued by the U.S. Department of Justice “related to its investigation of allegations of medically unnecessary laboratory testing, improper billing for laboratory testing, and remuneration received or provided in violation of the Anti-Kickback Statute and the Stark Law.” On this news, Fulgent’s stock price fell $11.02, or 17.29%, over the following two trading sessions, to close at $52.72 per share on August 8, 2022.
Next Steps: If you acquired shares of Fulgent Genetics, Inc. between March 22, 2019 and August 4, 2022, you have until November 21, 2022, to ask the court to appoint you lead plaintiff for the class. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.