MiMedx Group, Inc. (NASDAQ: MDXG)
On October 27, 2017, SeekingAlpha published a report entitled “Short seller Cohodes writes letter to MiMedx chief Petit after receiving incriminating email from current employee; shares down 1%.” According to the report, “[t]he employe[e] said Mr. Petit was fully aware of stuffing product into VA hospitals and cited evidence of changing or deleting evidence related to such activities from the company’s IT system.”
Previously, on September 20, 2017, Aurelius Value published a report entitled “MiMedx: Flying Too Close To The Sun” questioning whether MiMedx has engaged in improper “channel stuffing” in violation of Generally Accepted Accounting Principles (“GAAP”). This news drove the price of MiMedx shares down over 6% to close at $12.34 on September 20, 2017.
The next day, the Company announced it received a subpoena from the SEC primarily related to channel stuffing allegations by former employees and there was a completed independent investigation into these matters.
Then, on September 27, 2017, SeekingAlpha published another Aurelius report entitled “MiMedx: Undisclosed Details Undermine ‘Independent’ Investigation’” claiming certain members of the Company’s Audit Committee and its outside counsel, both of whom were involved in the completed investigation, were not actually independent. This news drove the price of MiMedx shares down over 3.5% during intraday trading on September 27, 2017.
“We’re assessing the matters highlighted by Aurelius and others, most recently those raised within SeekingAlpha, concerning potential improper revenue recognition and other potential GAAP violations, and investors’ damages,” said Hagens Berman partner Reed Kathrein.
Whistleblowers: Persons with non-public information regarding MiMedx should consider their options to help in the investigation or take advantage of the SEC whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 510-725-3000 or email MDXG@hbsslaw.com.
Hagens Berman purchases advertisements on search engines, social media sites and other websites. If you send us information, note that does not create an attorney-client relationship with the firm.