NEW YORK, Sept. 15, 2020 (GLOBE NEWSWIRE) -- Abraham, Fruchter & Twersky, LLP (www.aftlaw.com) announces that it has filed a class action lawsuit against Progenity, Inc. (“PROGENITY”) (NASDAQ: PROG) on behalf of investors who purchased PROGENITY stock pursuant and/or traceable to PROGENITY’s registration statement and related prospectus (“Registration Statement”), issued in connection with PROGENITY’s June 2020 initial public offering (“IPO”). The class action, filed in the United States District Court for the Southern District of California, charges PROGENITY, certain of its officers and directors, and the underwriters of the IPO (together, “Defendants”), with violations of the Securities Act of 1933. The class action is captioned Brickman Investments Inc. v. Progenity, Inc., et al., No. 3:20-cv-01795 (S.D. Cal.).
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased PROGENITY common stock pursuant to the IPO Registration Statement to seek appointment as lead plaintiff of the pending class action. A lead plaintiff acts on behalf of all other class members in directing the litigation. The lead plaintiff can select a law firm of its choice. An investor’s ability to share in any potential future recovery of the lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of this litigation, you must submit an application to the Court no later than October 27, 2020.
If you purchased PROGENITY stock and would like to inquire about pursuing claims to recover losses or seeking appointment as lead plaintiff, you are encouraged to contact Abraham, Fruchter & Twersky, LLP by e-mailing either Jack G. Fruchter (JFruchter@aftlaw.com) or Sean M. Handron-O’Brien (SHandronobrien@aftlaw.com). You may also call and leave a message at (212) 279-5050, Ext. 1602 or Ext. 1626.
On or about June 22, 2020, Defendants conducted PROGENITY’s IPO. In the IPO, Defendants sold over 6.6 million shares of PROGENITY common stock to the investing public at a price of $15.00 per share, generating over $100 million in gross proceeds.
The Complaint filed by Abraham, Fruchter & Twersky, LLP, alleges that PROGENITY’s Registration Statement was negligently prepared and, as a result, failed to make the necessary disclosures required under the rules and regulations governing its preparation. Specifically, the Registration Statement failed to disclose that: (i) PROGENITY had overbilled government payors by $10.3 million in 2019 and early 2020 and, thus, had materially overstated its revenues, earnings and cash flows from operations for the historical financial periods provided in the Registration Statement; (ii) PROGENITY would need to refund this overpayment in the second quarter of 2020 (the same quarter in which the IPO was conducted), adversely impacting its quarterly results; and (iii) PROGENITY was suffering from accelerating negative trends in the second quarter of 2020 with respect to PROGENITY’s testing volumes, revenues and product pricing.
Shortly after the IPO, the price of PROGENITY stock declined significantly. By August 14, 2020, PROGENITY’s stock closed at just $7.71 per share, or nearly 50% below the $15.00 per share price investors paid for the stock in the IPO less than two months previously.
Abraham, Fruchter & Twersky, LLP (www.aftlaw.com), is a law firm based in New York and maintaining an office in California. Abraham, Fruchter & Twersky, LLP has extensive experience in litigating securities class action cases. The firm has been ranked among the leading class action law firms in terms of recoveries achieved for shareholders, most recently obtaining approval of a $48,750,000 settlement in In re Terraform Global Securities Litigation, No. 1:16-cv-07967 (S.D.N.Y.), representing as much as 75% of likely recoverable damages.
If you have any questions about this Notice, the action, your rights or your interests, please contact:
Jack G. Fruchter
Sean M. Handron-O’Brien
Abraham, Fruchter & Twersky, LLP
One Penn Plaza, Suite 2805
New York, New York 10119
Tel: (212) 279-5050, Ext. 1602 or 1626
Fax: (212) 279-3655
Email: JFruchter@aftlaw.com
SHandronobrien@aftlaw.com