Insulet (PODD) Securities Fraud Class Action Lawsuit
On April 30, 2015 Insulet announced that its revenues for the first quarter 2015 did not meet expectations and rationalized to investors that the revenue shortfall would be realized in subsequent quarters. This class action alleges that Insulet executives overstated revenue and revenue growth expectations for several years to artificially inflate the stock price.
What investors are part of this class action? This case (as currently pled) covers all shareholders that purchased Insulet common stock between February 27, 2013 and April 30 2015. Insulet Corporation common stock trades under the symbol PODD.
Procedural Status. The lawsuit was filed on May 5, 2015 and is captioned Murphy v. Insulet Corporation et al. It was filed in the Massachusetts District Court. Its civil docket number is 1:15cv11782. The lead plaintiff deadline is July 6, 2015.
Insulet is primarily engaged in the development, manufacturing and sale of its proprietary OmniPod Insulin Management System (the “OmniPod System”), an insulin infusion system for people with insulin-dependent diabetes. The OmniPod System features a disposable tubeless OmniPod which is worn on the body for approximately three days at a time and the handheld, wireless Personal Diabetes Manager.
The complaint alleges that Insulet made false and/or misleading statements, as well as failed to disclose material adverse facts about its business, operations, and prospects,including the following:
Insulet was experiencing slower demand for the OmniPod System;
Insulet was facing issues with its sales and marketing efforts relating to the OmniPod System;
Insulet was experiencing unevenness in its financial performance; and
that, as a result of the foregoing, management’s positive statements about Insulet’s business, operations, and prospects particularly related to the OmniPod System lacked a reasonable basis.
Current Case Status:
This case is in the notice period. When a shareholder brings suit under certain federal securities law, generally that shareholder must give notice via a press release. This notice starts a 60 day period of time when any shareholder can investigate the underlying claims of the lawsuit and then elect to bring suit as well. At the end of this 60 day period, the court appoints one shareholder (or a group of shareholders) to prosecute the securities litigation. We will review the docket again in June and update this page as warranted.