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SAN FRANCISCO, October 19, 2021--(BUSINESS WIRE)--The law firm of Lieff Cabraser Heimann & Bernstein, LLP announces that class action litigation has been filed on behalf of investors who purchased or otherwise acquired the securities of Eargo, Inc. ("Eargo" or the "Company") (NASDAQ: EAR) between February 25, 2021 and September 22, 2021, inclusive (the "Class Period").
If you purchased or otherwise acquired Eargo securities during the Class Period, you may move the Court for appointment as lead plaintiff by no later than December 6, 2021. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. Your share of any recovery in the actions will not be affected by your decision of whether to seek appointment as lead plaintiff. You may retain Lieff Cabraser, or other attorneys, as your counsel in the action.
Eargo investors who wish to learn more about the litigation and how to seek appointment as lead plaintiff should click here, or text or email firstname.lastname@example.org, or call Sharon M. Lee of Lieff Cabraser at 1-800-541-7358.
Background on the Eargo Securities Class Litigation
Eargo, headquartered in San Jose, California, is a manufacturer of rechargeable hearing aids. A major portion of the Company’s revenues depends on reimbursements from third-party payor insurance companies.
The action alleges that, throughout the Class Period, Eargo failed to disclose to investors: (1) that the Company had improperly billed certain third-party payors, including its largest such payor; (2) that such actions were likely to lead to regulatory scrutiny; and (3) that, as a results of the foregoing, Eargo’s positive statements about its business and prospects were false and misleading and lacked any reasonable basis in fact.
On August 12, 2021, the Company disclosed that claims submitted to its largest third-party payor had gone unpaid since March 31, 2021, and that those claims represented 80% of Eargo’s gross account receivables as of June 30, 2021. On this news, the price of Eargo common stock fell $8.00 per share, or 24.46%, from its closing price of $32.70 on August 12, 2021, to close at $24.70 per share on August 13, 2021, on elevated trading volume.
On September 22, 2021, after market close, the Company reported that it was "the target of a criminal investigation by the U.S. Department of Justice (the ‘DOJ’) related to insurance reimbursement claims the Company submitted on behalf of its customers covered by federal employee health plans." As a consequence, Eargo withdrew its financial guidance for fiscal 2021. On this news, the price of Eargo common stock fell $14.81 per share, or 68.34%, from its closing price of $21.67 on September 21, 2021, to close at $6.86 on September 22, 2021, on extremely heavy trading volume.
About Lieff Cabraser
Lieff Cabraser Heimann & Bernstein, LLP, with offices in San Francisco, New York, and Nashville, is a nationally recognized law firm committed to advancing the rights of investors and promoting corporate responsibility.
The National Law Journal has recognized Lieff Cabraser as one of the nation’s top plaintiffs’ law firms for fourteen years. In compiling the list, the National Law Journal examines recent verdicts and settlements and looked for firms "representing the best qualities of the plaintiffs’ bar and that demonstrated unusual dedication and creativity." Law360 has selected Lieff Cabraser as one of the Top 50 law firms nationwide for litigation, highlighting our firm’s "laser focus" and noting that our firm routinely finds itself "facing off against some of the largest and strongest defense law firms in the world." Benchmark Litigation has named Lieff Cabraser one of the "Top 10 Plaintiffs’ Firms in America."
For more information about Lieff Cabraser and the firm’s representation of investors, please visit https://www.lieffcabraser.com/.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
View source version on businesswire.com: https://www.businesswire.com/news/home/20211019006230/en/
Source/Contact for Media Inquiries Only
Sharon M. Lee
Lieff Cabraser Heimann & Bernstein, LLP