Deadline Reminder: Law Offices of Howard G. Smith Reminds Investors of Looming Deadline in the Class Action Lawsuit Against Eargo, Inc. (EAR)

BENSALEM, Pa.--(BUSINESS WIRE)--Law Offices of Howard G. Smith reminds investors of the upcoming December 6, 2021 deadline to file a lead plaintiff motion in the case filed on behalf of investors who purchased Eargo, Inc. (“Eargo” or the “Company”) (NASDAQ: EAR) securities between February 25, 2021 and September 22, 2021, inclusive (the “Class Period”).

Investors suffering losses on their Eargo investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to [e-mail].

On August 12, 2021, after the market closed, Eargo revealed that claims submitted to the Company’s largest third-party payor, which accounted for 80% of Eargo’s accounts receivable, had not been paid since March 1, 2021.

On this news, the Company’s share price fell $8.00, or over 24%, to close at $24.70 per share on August 13, 2021, on unusually heavy trading volume.

On September 22, 2021, after the market closed, Eargo revealed that “it is the target of a criminal investigation by the U.S. Department of Justice (the ‘DOJ’) related to insurance reimbursement claims the Company has submitted on behalf of customers covered by federal employee health plans.” Moreover, the DOJ is the “principal contact related to the subject matter of the [ongoing] audit” of Eargo by an insurance company that is the Company’s largest third-party payor. As a result of the foregoing, Eargo withdrew its full year financial guidance.

On this news, the Company’s share price fell $14.81, or over 68%, to close at $6.86 per share on September 23, 2021, on unusually heavy trading volume.

The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Eargo had improperly sought reimbursements from certain third-party payors; (2) that the foregoing was reasonably likely to lead to regulatory scrutiny; (3) that, as a result and because the reimbursements at issue involved the Company’s largest third-party payor, Eargo’s financial results would be adversely impacted; and (4) as a result, Defendants’ statements about its business, operations, and prospects were materially false and misleading and/or lacked reasonable basis at all relevant times.

If you purchased or otherwise acquired Eargo securities during the Class Period, you may move the Court no later than December 6, 2021 to ask the Court to appoint you as lead plaintiff if you meet certain legal requirements. To be a member of the class action you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action. If you wish to learn more about this class action, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at [phone], toll-free at [phone], or by email to [e-mail], or visit our website at www.howardsmithlaw.com.

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