LOS ANGELES–(BUSINESS WIRE)–The Law Offices of Frank R. Cruz continues its investigation of OrthoPediatrics Corp. (“OrthoPediatrics” or the “Company”) (NASDAQ: KIDS) on behalf of investors concerning the Company’s possible violations of federal securities laws.
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On December 2, 2020, Culper Research issued a report entitled “OrthoPediatrics Corp. (KIDS): Even Channel Stuffing Can’t Save This Company,” alleging that the Company “engaged in a channel stuffing scheme that has systematically and significantly overstated revenues.” Citing interviews with distributors and former executives, the report alleged that “distributors have been induced to buy excess product directly from the Company in exchange for (a) equity-based awards, (b) the opportunity to return product, and/or (c) product discounts or increased commission schedules.”
On this news, the Company’s stock price fell $4.12 per share, or 9%, to close at $41.02 per share on December 2, 2020, thereby injuring investors.
Then, on December 30, 2020, Culper Research tweeted that “a recent [Freedom of Information Act] request suggests that the Company is under an active SEC investigation,” citing a letter from the SEC that it withheld certain records pursuant to an exemption that “protects from disclosure records compiled for law enforcement purposes, the release of which could reasonably be expected to interfere with enforcement activities.”
On this news, the Company’s stock price fell $2.81, or 6%, to close at $43.57 per share on December 30, 2020, thereby injuring investors further.
Then, on December 31, 2020, OrthoPediatrics confirmed reports of an SEC investigation. The Company stated that it was “responding to a non-public, fact-finding inquiry” by the SEC, which had been initiated following Culper Research’s report on December 2, 2020.
On this news, the Company’s stock price fell $2.32, or 5%, to close at $41.25 per share on December 31, 2020, thereby injuring investors further.
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If you purchased OrthoPediatrics securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to email@example.com, or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
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