McCune Law Group, McCune Wright Arevalo Vercoski Kusel Weck Brandt APC (MLG) – a national firm specializing in Securities Litigation, Unfair & Deceptive Acts & Practices litigation, and Class Actions – is investigating claims against Fulgent Genetics, Inc. over their alleged dishonesty surrounding a Department of Justice (DOJ) investigation into the company’s alleged illegal practices and the SEC’s investigation into Fulgent’s reports.
The lawsuit, Pugley v. Fulgent Genetics, Inc., et al, has been filed in the U.S. District Court for the Central District of California on behalf of all those who purchased Fulgent securities between March 22, 2019, and August 4, 2022.
Fulgent Genetics provides medical laboratory testing for patients at their doctors’ request. In addition to offering private practice testing, Fulgent also performs testing mandated by the federal government, including COVID-19 molecular diagnostic testing and genetic tests. As a supplier of federal health services, Fulgent Genetics is beholden to the Anti-Kickback Statute which prevents any company acting in service to the government from receiving remunerations (or kickbacks) for referred testing.
The lawsuit alleges Fulgent made false and/or misleading statements and failed to disclose that it was conducting medically unnecessary laboratory testing, engaging in improper billing practices related to laboratory testing, and providing or receiving kickbacks in violation of the Federal Anti-Kickback Statute and Stark Law. Additionally, the lawsuit claims these alleged illegal practices would have caused immense damage to the company’s finances and reputation if they were ever revealed, leading it to conceal the truth.
On August 4, 2022, Fulgent revealed it was the subject of an investigation by the DOJ, citing allegations of unnecessary testing, improper billing, and receiving or providing kickbacks. It also revealed that the SEC is conducting an investigation into potentially false or misleading reports for 2018 through the first quarter of 2020.
On this news, investors suffered significant losses, with Fulgent’s share price falling $11.02 per share, or 17.29%, over the following two trading sessions, to close at $52.72 per share on August 8, 2022.
“Investing your own hard-earned money into a company you believe in is a major risk,” remarked MLG Attorney Elaine S. Kusel, “These investors did their due diligence before investing in Fulgent and that trust was not repaid in kind. They are not at fault for Fulgent’s unlawful actions and the fallout.”