NEW YORK, June 18, 2020 (GLOBE NEWSWIRE) -- Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com) has filed a class action suit in the United States District Court for the Eastern District of New York against Chembio Diagnostics, Inc. (“Chembio” or the “Company”) (Nasdaq: CEMI), Richard L. Eberly, the Company’s Chief Executive Officer, and Gail S. Page, executive chair of the Company’s board of directors.
The Complaint alleges that Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder by the U.S. Securities and Exchange Commission, and is brought by plaintiff on behalf of all persons and entities who purchased the publicly traded common stock of Chembio during the period April 1, 2020 through June 16, 2020, inclusive (“Class Period”).
If you are a member of the proposed Class, you may move the court no later 60 days from today to serve as a lead plaintiff for the proposed Class. You need not seek to become a lead plaintiff in order to share in any possible recovery.
The Complaint alleges that Defendants represented that the Company’s Dual Path Platform (“DPP”) COVID-19 serological point-of-care test for the detection of IgM and IgG antibodies aided in determining current or past exposure to the COVID-19 virus, that its test provides high sensitivity and specificity, and was 100% accurate.
The Complaint further alleges that on May 11, 2020, Defendants took advantage of Chembio’s inflated stock price, closing a public offering of approximately 2.6 million shares of Chembio stock at $11.75 per share for gross proceeds of approximately $30.8 million.
Then, on June 16, 2020, after the market closed, the U.S. Food and Drug Administration (“FDA”) issued a press release disclosing that it had revoked the Company’s Emergency Use Authorization (“EUA”) for the Company’s DPP COVID-19 Igm/IgG System “due to performance concerns with the accuracy of the test” and because “data submitted by Chembio as well as an independent evaluation of the Chembio test at NCI showed that this test generates a higher than expected rate of false results and higher than that reflected in the authorized labeling for the device.”
As a result of disclosure of the FDA letter, Chembio shares declined from a closing price on June 16, 2020 of $9.93 per share to close at $3.89 per share on June 17, 2020, a decline of $6.04 per share, or over 60%, on heavier than usual volume of over 25 million shares.
Plaintiff seeks to recover damages on behalf of the proposed Class and is represented by Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com). Our firm, with offices in New York, Oakland, Los Angeles, Chicago, and New Jersey, has decades of experience in prosecuting investor class actions and actions involving violations of the Federal securities laws.
If you have any questions about this Notice, the action, your rights, or your interests, or would like a copy of the complaint, please e-mail attorneys Jeff Campisi (jcampisi@kaplanfox.com), or Larry King (lking@kaplanfox.com), or contact them by phone, regular mail, or fax:
| Jeffrey P. Campisi KAPLAN FOX & KILSHEIMER LLP 850 Third Avenue, 14th Floor New York, NY 10022 Telephone: (212) 328-8571 Fax: (212) 687-7714 E-mail address: jcampisi@kaplanfox.com | Laurence D. King KAPLAN FOX & KILSHEIMER LLP 1999 Harrison Street, Suite 1560 Oakland, CA 94612 Telephone: (415) 772-4704 Fax: (415) 772-4709 E-mail address: lking@kaplanfox.com |