On May 31, 2017, Judge Beverly Reid O’Connell of the United States District Court, Central District of California, appointed Kehoe Law Firm as co-lead counsel, along with the Gibbs Law Group, in the Nanthealth Securities Litigation pending in the United States District Court for the Central District of California. Judge O’Connell cited the firm’s “significant securities class action litigation experience” and history of achieving “highly favorable settlements for plaintiffs in previous actions.”
NantHealth had completed its initial public offering of common stock on June 7, 2016, and sold 6,500,000 shares at $14.00 per share. Plaintiffs, which include the Southeastern Pennsylvania Transportation Authority Pension Plan, allege that NantHealth’s founder, Patrick Soon-Shiong, violated federal securities law and artificially inflated NantHealth’s stock price by structuring a purportedly philanthropic donation to the University of Utah such that the University was obligated to pay NantHealth $10 million for research services. Additionally, plaintiffs alleged that NantHealth exaggerated the success of one of its key products, called GPS Cancer.
STAT published an article on March 6, 2017, alleging that pursuant to the terms of Soon-Shiong’ s donation, the University of Utah was effectively required to spend $10 million on genetics analysis performed by NantHealth, an arrangement which STAT suggested enabled NantHealth to inflate by more than 50 percent the number of test orders it reported to investors in 2016.
On this news, the company’s stock price fell $1.67, or 23.29%, to close at $5.50 on March 6, 2017, and closed at $4.55 on March 9, 2017. Plaintiffs allege that the stock price continued to drop as more information came out about both the donation and the viability of GPS Cancer.
John A. Kehoe, partner at Kehoe Law Firm, said the firm is honored to be appointed lead counsel and that this recognition reflects our firm’s experience and successful record in securities class action litigation. Mr. Kehoe added, “We are committed to uncovering the truth and pursuing justice for plaintiffs, such as the Southeastern Pennsylvania Transportation Authority Pension Plan. This appointment is not just a nod to our past success but a catalyst for us to diligently advocate for fairness and integrity in this legal pursuit.”
For more information about Kehoe Law Firm and its involvement in this matter, please contact John A. Kehoe at [email protected] or call (215) 792-6676.