Lead Plaintiff Filing Deadline Remains November 29, 2024
Hagens Berman announces that the firm and additional counsel have filed a new class action lawsuit against Paragon 28, Inc. (NYSE: FNA) and certain of its senior executives.
The new complaint extends the alleged fraudulent period in the pending litigation against Paragon 28, contending that Paragon 28’s stock was artificially inflated by Defendants’ alleged fraud from May 5, 2023 through Sept. 20, 2024, inclusive (“Extended Class Period”).
Lead plaintiff motions for the Paragon 28 class action litigation must still be filed with the Court no later than November 29, 2024. Hagens Berman therefore urges investors who suffered substantial losses on purchases of Paragon 28 securities during the Extended Class Period and who wish to serve as lead plaintiff of the Paragon 28 litigation to submit your losses now.
New Paragon 28 (FNA) Securities Fraud Class Action Alleging Extended Class Period:
The new class action, filed in the United States District Court for the District of Colorado, and captioned Tiedt v. Paragon 28, Inc., et al.,Case No. 1:24-cv-02898, seeks 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.
The new class action is related to pending securities class action litigation against Paragon 28 in the District of Colorado, Ellington v. Paragon 28, Inc., 1:24-cv-02712 (PAB/TPO), which alleges a class period of May 5, 2023 through Aug. 8, 2024, inclusive.
The new class action, however, alleges a broader class period, as the new case is brought on behalf of all investors who purchased or otherwise acquired Paragon 28 securities during the Extended Class Period – between May 5, 2023 and Sept. 20, 2024, inclusive.
If you are a shareholder who purchased Paragon 28 shares during the Extended Class Period, you have until November 29, 2024, to ask the Court to appoint you as Lead Plaintiff for the class in the Paragon 28 litigation. A copy of the Complaint can be obtained here. Click here to discuss your legal rights with Hagens Berman.
CASE ALLEGATIONS: The new Paragon 28 class action lawsuit alleges that defendants throughout the Extended Class Period 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, the Complaint alleges Defendants misrepresented and concealed that Paragon: (a) understated its Adjusted EBITDA losses; (b) overstated its net inventories; (c) understated required provisions for excess and obsolete inventory; (d) understated its cost of goods sold; (e) overstated gross profit; (f) understated operating loss; (g) understated net loss; (h) lacked adequate disclosure controls and procedures and internal control over financial reporting; (i) would be required to restate its financial statements to conform with generally accepted accounting principles; and (j) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis
The truth began to emerge on April 4, 2024, when Paragon issued a press release announcing that Defendant Deitsch resigned, and the Company’s Audit Committee Chair (Kristina Wright) stepped in as interim CFO effective April 3, 2024. This news sent the price of Paragon shares down $1.86 (-15%) that day.
Then, after the market closed on August 8, 2024, Paragon announced that it had made errors in its financial statements and that its internal controls were inadequate. The company admitted to overstating its inventory and understating its cost of goods sold, which led to overstated profits. This news sent the price of Paragon shares down $1.67 (-20%) on August 9, 2024.
Finally, after the market closed on September 20, 2024, Paragon disclosed the abrupt departure of Defendant Erik Mickelson, the Company’s Chief Accounting Officer. This news sent the price of Paragon shares down $0.30 (-4.3%) on September 23, 2024.
THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased or acquired Paragon 28 securities during the Class Period to seek appointment as lead plaintiff of the Paragon 28class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the Paragon 28class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Paragon 28 class action lawsuit. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff of the Paragon 28 class action lawsuit. Lead plaintiff motions for the pending Paragon 28 class action litigation must be filed with the Court no later than November 29, 2024.
If you’d like more information and answers to frequently asked questions about the Paragon 28 case and our investigation, read more »
Whistleblowers: Persons with non-public information regarding Paragon 28 should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email FNA@hbsslaw.com.
About Hagens Berman
Hagens Berman is a global plaintiffs’ rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman’s team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.
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