| COMPANY |
Veradigm Inc. |
| COURT |
United States District Court for the Northern District of Illinois |
| CASE NUMBER |
23-cv-16205 |
| JUDGE |
The Hon. Lindsay Clayton Jenkins |
| CLASS PERIOD |
February 26, 2021 through December 7, 2023 |
| SECURITY TYPE |
Common Stock |
Veradigm investors may receive additional information about the case by clicking the link "Submit Your Information" above. If you are a member of the class described below, you may no later than January 22, 2024 move the Court to serve as lead plaintiff of the class, if you so choose.
A class action lawsuit has been filed on behalf of those who purchased or acquired Veradigm Inc. (“Veradigm”) (NASDAQ: MDRX) common stock between February 26, 2021 and December 7, 2023, both dates inclusive (the “Class Period”).
Case Background:
On February 28, 2023, Veradigm disclosed that the company had “detected certain internal control failures related to revenue recognition that have occurred over the prior six quarters, resulting in a mis-statement to reported revenues during those periods.” As a result, Veradigm reported that it expects “a reduction in revenue from continuing operations of approximately $20 million dollars in the aggregate from what it otherwise reported since the 3rd quarter of 2021 and expected to report for the 4th quarter of 2022.” Subsequently, Veradigm also lowered its previously provided fiscal year 2023 revenue guidance by $15 million and its non-GAAP earnings per share guidance by $0.10 per share and disclosed that it would not be filing its 2022 annual report on time. Following this news, the price of Veradigm common stock declined $2.12 per share, or nearly 13%, from a close of $16.61 per share on February 28, 2023, to close at $14.49 per share on March 1, 2023.
Then on March 22, 2023, Veradigm announced that the size and scope of the revenue misstatements were significantly greater than previously disclosed, revealing that revenues had been overstated by approximately $40 million and that quarterly filings in fiscal years 2021 and 2022 could no longer be relied upon, and would need to be restated. Moreover, Veradigm revealed that the company would “report one or more material weaknesses . . . related to the recognition of revenue and certain other non-routine review controls.” Finally, Veradigm disclosed that it was lowering its previously disclosed fiscal year 2023 revenue guidance range by another $10 million. Following this news, Veradigm’s stock price fell $0.39, or 2.9%, to close at $12.98 per share on March 22, 2023.
On June 13, 2023, Veradigm announced that the company had identified additional revenue misstatements dating back to fiscal year 2020 and that an internal review on the nature and extent of the accounting and internal control errors would take longer than previously disclosed. As a result, Veradigm revealed that the company would not meet the deadline to file its fiscal 2022 annual report with the SEC. Following this news, the price of Veradigm common stock declined $0.53 per share, or more than 4.4%, from a close of $12.02 per share on June 13, 2023, to close at $11.49 per share on June 14, 2023.
Finally, on December 8, 2023, Veradigm announced that both its CEO and CFO had been forced to resign at the request of the Board of Directors. Following this news, the price of Veradigm stock fell more than 20%, to close at $10.07 on December 8, 2023.
The complaint 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 misrepresented and/or failed to disclose that: (1) Veradigm had overstated its historical revenues by at least $20 million; (2) Veradigm had artificially inflated its revenue by recording duplicate transactions, among other things, over a more than two-year period; (3) Veradigm had artificially inflated its earnings and margins and materially misrepresented demand for Veradigm’s products and services; (4) Veradigm had failed to maintain effective internal control over its financial reporting; and (5) Veradigm had failed to comply with Generally Accepted Accounting Principles (“GAAP”) regarding appropriate revenue recognition practices; and (6) as a result, Defendants’ statements about the company’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP: Jonathan Naji, Esq. (484) 270-1453 or via e-mail at info@ktmc.com. If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.