NEW YORK--(BUSINESS WIRE)--Pomerantz LLP announces that a class action lawsuit has been filed against Cancer Genetics, Inc. (“Cancer Genetics” or the “Company”) (NASDAQ: CGIX) and certain of its officers. The class action, filed in United States District Court, District of New Jersey, and docketed under 18-cv-06353, is on behalf of a class consisting of investors who purchased or otherwise acquired Cancer Genetics securities between March 23, 2017 through April 2, 2018, both dates inclusive (the “Class Period”), seeking to recover damages caused by defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.
If you are a shareholder who purchased Cancer Genetics securities between March 23, 2017, and April 2, 2018, both dates inclusive, you have until June 4, 2018, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at firstname.lastname@example.org or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
Cancer Genetics is a diagnostics company focused on the development and commercialization of proprietary genomic tests and services to improve the diagnosis, prognosis, and response to treatment (theranosis) of cancer.
On October 12, 2015, Cancer Genetics issued a press release entitled, “Cancer Genetics, Inc. Finalizes Purchase of Los Angeles-based Molecular Profiling Laboratory, Response Genetics, Inc., Adding $10-$12M in Annual Revenue and Establishing a National Clinical Sales Footprint” which announced that Cancer Genetics closed its acquisition of Response Genetics, Inc., a molecular profiling laboratory, on October 9, 2012.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Cancer Genetics had ineffective disclosure controls and internal controls over financial reporting; and (ii) as a result of the foregoing, Cancer Genetics’ public statements were materially false and misleading at all relevant times.
On April 2, 2018, after the market closed, Cancer Genetics filed its Annual Report on Form 10-K with the Securities and Exchange Commission (“SEC”), announcing the Company’s financial and operating results for the quarter and year ended December 31, 2017 (the “2017 10-K”). The 2017 10-K discussed the Company’s controls over financial reporting, stating in relevant part: “[W]e evaluated, under the supervision and with the participation of our principal executive officer and principal financial officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a 15(e) and 15d-15(e) under the Exchange Act, as amended as of December 31, 2017, the end of the period covered by this report on Form 10-K. Based on this evaluation, the principal executive officer and the principal financial officer have concluded that our disclosure controls and procedures were not effective at December 31, 2017, as a result of the material weakness in internal controls described below. Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and were operating in an effective manner for the period covered by this report, and (ii) is accumulated and communicated to management, including, the principal executive officer and principal financial officer, or the person performing similar functions as appropriate, to allow timely decisions regarding required disclosures.”
Further, on April 2, 2018, after the market closed, Cancer Genetics issued a press release entitled “Cancer Genetics Reports Fourth Quarter and Full Year 2017, Financial Results and Provides Strategic Business Updates.” The press release discussed the fourth quarter and full year 2017 financial results, stating in relevant part: “[A] major area of concentrated focus during the first quarter of 2018 was the careful evaluation of the Company’s accounts receivables, which had increased to approximately $16 million on the balance sheet prior to any adjustments. A significant reason for the increase was disruptions in collections in its Clinical Services business. While the Company continues with its collections efforts on all claims, in the fourth quarter it recorded a bad debt expense of $4.4 million and wrote off $1.8 million of its accounts receivable, with a significant portion of the bad debt expense and write off related to collection issues with respect to the accounts receivable recorded subsequent to the 2015 acquisition of Response Genetics Inc.”
On this news, Cancer Genetics’ share price fell $0.55, or over 33.3%, to close at $1.10 per share on April 3, 2018, damaging investors.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com