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IRTC.US

id: 1047

iRhythm Technologies, Inc. ($IRTC) $45 Million Investor Settlement

The settlement terms have been submitted to the court for approval.

$45,000,000

Cash Settlement

N.D. California

Court

3:24-cv-00706

Case number

07/25/2022

Class period Start

08/29/2024

Class period End

iRhythm Technologies, Inc. has agreed to a proposed $45 million settlement to resolve investor claims tied to statements about Zio AT’s data transmission, use in high-risk patients, and the accuracy of the data reported by the device.

Outline:

On November 1, 2022, iRhythm cut guidance after weaker Zio AT utilization. On November 4, 2022, it disclosed a Customer Advisory Notice tied to FDA inspection issues but kept promoting Zio AT’s prospects. On May 4, 2023, the company disclosed a DOJ subpoena, and later an FDA warning letter challenged how Zio AT was marketed for high-risk patients. $IRTC fell on the news, and the case has now moved to a proposed $45 million settlement.

Timeline:
November 1, 2022: iRhythm revised guidance due to Zio AT utilization and lowered its growth forecast from 40% to 20%.
November 4, 2022: iRhythm disclosed a Customer Advisory Notice following FDA inspection issues and sought to reassure investors about Zio AT.
May 4, 2023: iRhythm disclosed that it had received a subpoena from the U.S. Department of Justice.
February 6, 2024: A securities class action was filed against iRhythm in the Northern District of California.
June 3, 2026: The parties entered into the settlement stipulation.
Background:

iRhythm makes cardiac-monitoring devices, including the Zio XT and Zio AT. The dispute centers on how the company described Zio AT’s transmission speed, data accuracy, and use for higher-risk patients.

On November 1, 2022, iRhythm cut guidance because Zio AT utilization was weaker than expected. Three days later, after FDA inspection issues, it issued a Customer Advisory Notice but still tried to reassure investors about Zio AT’s growth prospects.

Investors later pointed to a DOJ subpoena disclosed on May 4, 2023 and an FDA warning letter that challenged how Zio AT was marketed. They say iRhythm improperly promoted the device for patients needing real-time cardiac monitoring, even though regulators later challenged that use.

The market reaction was sharp. According to the text provided, $IRTC fell 6.09% and lost more than $227 million in market value on the warning-letter news, and the case has now moved to a proposed $45 million settlement.

What Can Investors Expect Now?

iRhythm Technologies, Inc. has agreed to a proposed $45 million settlement to resolve investor claims tied to statements about Zio AT’s data transmission, use in high-risk patients, and the accuracy of the data reported by the device.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section.

Case Type

US Securities Class Action

Case Status

Stipulative Settlement

Alleged Offence

Misleading Statements,

Failure to Disclose,

Omissions

Suspected Party

Directors,

Management

Security Type

Stocks

Trade Direction

Long

Payout per Share

12050000

Filing date

02/06/2024

Lead Plaintiff Deadline

04/08/2024

Plaintiffs

Glazing Employers and Glaziers Union Local #27 Pension and Retirement Fund

Attorneys

Robbins Geller Rudman & Dowd LLP

Defendants

Quentin Blackford, Brice Bobzien and Douglas Devine

Administrator

Strategic Claims Services

Attorney fee

$1.83

Trades matching type

FIFO

Frequently Asked Questions

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