NEW YORK, Sept. 30, 2020 /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of Tactile Systems Technology, Inc. ("Tactile" or the "Company") (NASDAQ: TCMD). Such investors are advised to contact Robert S. Willoughby at [email protected] or 888-476-6529, ext. 7980.
The investigation concerns whether Tactile and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
On March 20, 2019, aftermarket hours, an amended federal qui tam complaint filed against Tactile by one of the Company's competitors and pending in the Southern District of Texas was unsealed. The qui tam complaint contained detailed allegations of illegal sales practices on the part of Tactile, causing the Company to submit fraudulent claims to Medicare and the Veteran's Administration. Specifically, the qui tam complaint accused Tactile of illegally paying hospital staff to induce physicians to prescribe its medical devices. The qui tam complaint further alleged that the Company had violated anti-kickback laws by paying physicians to be "advisors" and "paid spokesmen" when these financial relationships were merely a way to secure those doctors' business.
On this news, Tactile's stock price fell $4.53 per share over the next two trading days, or 7.5%, to close at $55.57 per share on March 22, 2019.
Then, on February 21, 2020, the court issued an order in the qui tam action, denying Tactile's motion to dismiss the complaint in its entirety. On this news, Tactile's stock price fell $6.65 per share, or 10.59%, to close at $56.09 per share on February 24, 2020. Finally, on June 8, 2020, the research firm OSS Research ("OSS") published a report about the Company entitled "Strong Sell on Tactile Systems: Bloated Stock Needs Compression Therapy." In the report, OSS accused Tactile of (1) overstating its total addressable market by nearly $4.7 billion, (2) using a "'daisy-chaining kickback scheme' that has resulted in rampant overprescribing and rapid market share gains at the expense of patients, insurers and the public," and (3) concealing Medicare audits resulting in denials, for failure to establish medical necessity, of 71% of Tactile's submitted claims.
On this news, the Company's stock price fell $6.05 per share, or 11.69%, to close at $45.67 per share on June 9, 2020.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.
Robert S. Willoughby
888-476-6529 ext. 7980
SOURCE Pomerantz LLP