The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Southern District of New York on behalf of those who acquired SCWorx Corp. (“SCWorx” or the “Company”) (NASDAQ: WORX) securities during the period from April 13, 2020 through April 17, 2020 (the “Class Period”). Investors have until June 29, 2020 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
The lawsuit alleges that the Company failed to disclose that: (i) SCWorx’s supplier for COVID-19 tests had previously misrepresented its operations; (ii) SCWorx’s buyer was a small company that was unlikely to adequately support the purported volume of orders for COVID-19 tests; and (iii) as a result, the Company’s purchase order for COVID-19 tests had been overstated or entirely fabricated.
On April 17, 2020, investment research firm Hindenburg Research issued a report alleging that the purchase order of two million COVID-19 testing kits announced by SCWorx on April 13, 2020 was “completely bogus.” Specifically, the buyer, Promedical, had previously claimed that it was offering COVID-19 test kits manufactured by company Wondfo. However, Wondfo stated that Promedical had “‘fraudulently mispresented themselves’ as sellers of its Covid-19 tests” and Promedical does not appear to be “capable of handling hundreds of millions of dollars in orders.”
On this news, the price of SCWorx shares fell $1.19 over three trading days, or 17.1%, to close at $5.76 per share on April 21, 2020. On April 22, 2020, the SEC halted trading on the Company’s stock.
If you acquired SCWorx securities, have information, or would like to learn more about these claims, please contact Thomas W. Elrod of Kirby McInerney LLP at 212-371-6600, by email at firstname.lastname@example.org, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.