Fulgent Genetics (FLGT) Officers and Directors Under Investigation for Possible False Statements About Its Business Operations and Compliance Policies

Schubert Jonckheer & Kolbe LLP is investigating potential derivative claims on behalf of shareholders of Fulgent Genetics (NASDAQ: FLGT) relating to possible false and misleading statements to investors about the company’s business operations and compliance policies. 

Fulgent provides COVID-19, molecular diagnostic, and genetic testing services to physicians and patients. Fulgent and three of its executive officers are currently subject to a class action securities lawsuit in the U.S. District Court for the Central District of California alleging certain false and misleading statements concerning the company’s compliance with federal laws. In 2019, Fulgent made numerous public statements that presented the image of a promising company with a high-growth billable testing sector. Throughout the COVID-19 pandemic, Fulgent continued to uplift its billable test revenues, particularly from its COVID-19 testing solutions.

The truth about Fulgent’s flawed operations emerged on August 4, 2022, when the company disclosed that it was being investigated by the Securities and Exchange Commission (SEC) and the U.S. Department of Justice (DOJ). The company revealed in a 10-Q filing that the DOJ had issued a Civil Investigative Demand “related to its investigation of allegations of medically unnecessary laboratory testing, improper billing for laboratory testing, and renumeration received or provided in violation of the Anti-Kickback Statute and the Stark Law.” In the same filing, Fulgent revealed that the SEC had initiated a non-public investigation into the company’s SEC filings from 2018 through the first quarter of 2020. Both disclosures cast doubt on the representations and statements made by Fulgent officers and directors between 2019 and 2022.

The Schubert Firm is investigating potential breaches of fiduciary duty by Fulgent’s officers and directors in connection with these allegations. If you own stock in Fulgent and wish to obtain additional information about your legal rights, please complete the form below for a free legal consultation.