Decision Diagnostics Corporation
Lead Plaintiff Deadline: 03/16/2021
SUMMARY OF CASE:
A securities class action has been filed against Decision Diagnostics Corporation (DECN) on behalf of a class consisting of all persons and entities other than Defendants that purchased or otherwise acquired Decision Diagnostics securities between March 3, 2020 through December 17, 2020. This case has been filed in the USDC – C.D.CA.
Decision Diagnostics purportedly offers, among other products and services, prescription and non-prescription diagnostics and home testing products.
From March 2020 to at least June 2020, Defendants claimed that the Company had developed a finger-prick blood test that could detect COVID-19 in less than one minute. Defendants also made various representations regarding the Company’s progress towards achieving U.S. Food and Drug Administration (“FDA”) emergency use authorization (“EUA”) for this purported COVID-19 finger-prick blood test.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements, and failed to disclose material adverse facts about the Company’s business, operational, and compliance policies. Specifically, Defendants made false and/or misleading statements and failed to disclose to investors that: (i) Decision Diagnostics had not developed any viable COVID-19 test, much less a test that could detect COVID-19 in less than one minute; (ii) the Company could not meet the FDA’s EUA testing requirements for its purported COVID-19 test; (iii) accordingly, Defendants had misrepresented the timeline within which it could realistically bring its COVID-19 test to market; (iv) all the foregoing subjected Defendants to an increased risk of regulatory oversight and enforcement; and (v) as a result, Defendants’ public statements were materially false and misleading at all relevant times.
On December 17, 2020, the SEC filed a complaint in federal court against Defendants, alleging that they had issued a series of press releases that falsely claimed that Decision Diagnostics had developed a finger-prick blood test that could detect COVID-19 in less than one minute (the “SEC Complaint”). According to the SEC Complaint, from March 2020 to at least June 2020, Defendants made false and misleading statements about the existence of Decision Diagnostics’ COVID-19 device and progress towards achieving FDA EUA for that device. As alleged, at the time of these claims, Decision Diagnostics lacked a proven method for detecting the virus and had no physical testing device. The SEC Complaint further alleged that the statements created the misleading impression that Decision Diagnostics would soon introduce the COVID-19 test to the market, which led to surges in the price and trading volume of the Company’s stock.
Following the filing of the SEC Complaint, Decision Diagnostics’ common share price fell $0.06 per share, or 60%, to close at $0.04 per share on December 18, 2020.