A class action lawsuit was filed against InMode Ltd. (NASDAQ:INMD) on February 14, 2024. The plaintiffs (shareholders) allege that they bought InMode stock at artificially inflated prices between June 4, 2021, and October 12, 2023 (Class Period) and are now seeking compensation for the losses. Investors who bought INMD stock during that period can learn about joining the lawsuit here: https://zlk.com/pslra-1/inmode-lawsuit-submission-form?wire=16
InMode produces and markets minimally invasive and non-invasive medical aesthetic products for hair and skin issues. The company claims that its new radio-frequency (RF)-based technology improves the existing surgical procedures in several specialties, including plastic surgery, gynecological, dermatological, and ophthalmological procedures.
Notably, the plaintiffs maintain that the company and four of its senior executives had repeatedly made false claims about the growing demand and pricing of its products. In reality, on February 17, 2023, an investigative publication revealed that “InMode threatened some customers with legal action over complaints made about the Company’s devices and sales tactics” and also agreed to replacements if customers signed confidentially agreements with “non-disparagement clauses.” Furthermore, InMode slashed the full-year revenue outlook, citing macro headwinds.
During the Class Period, InMode repeatedly claimed that it was seeing high demand in North America and that patients and physicians were highly satisfied with its products. Also, InMode claimed that Morpheus8 was becoming its most popular minimally invasive procedure.
As per the class action lawsuit, InMode had caused the INMD stock to trade at artificially inflated prices by knowingly and recklessly misleading investors about its business performance.
Notably, in October 2023 alone, INMD stock lost over 36%, massively impacting the shareholders’ holding value.
