Robbins Arroyo LLP: InfuSystem Holdings, Inc. (INFU) Misled Shareholders According to a Recently Filed Shareholder Derivative Lawsuit
Robbins Arroyo LLP announces that a shareholder derivative complaint was filed on behalf of InfuSystem Holdings, Inc. (NYSE MKT: INFU) in the Superior Court of the State of California, County of Los Angeles. The complaint is brought against certain officers and directors of the company for breaches of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets from May 12, 2015 through the present. InfuSystem, through its subsidiaries, provides infusion pumps and related products and services in the United States and Canada.
InfuSystem Accused of Overstating Revenues in Its Financial Statements
According to the complaint, in several filings submitted to the U.S. Securities and Exchange Commission (“SEC”), InfuSystem attested to the accuracy of the company’s financial statements, the effectiveness of internal controls, and that all fraud was disclosed. However, InfuSystem officials allegedly omitted material information regarding the company’s deficient internal controls over financial reporting and the overstatement of estimated accounts receivable collections, revenues, and pre-tax income dating back to the beginning of 2015. As a result of the InfuSystem’s omissions, its financial statements dating back to the first quarter of 2015 were unreliable.
The truth first emerged on November 7, 2016, in InfuSystem’s Form 8-K filed with the SEC in which the company disclosed that certain financial statements contained an error that applied an incorrect cash collection percentage, which resulted in miscalculating future cash collections expected from outstanding accounts receivables. In its amended 2015 Form 10-K filed on December 12, 2016, the company confirmed that accounts receivable errors impacted revenues and pre-tax income by approximately $3.3 million from the beginning of 2015 to the end of second quarter of 2016. Furthermore, the company admitted that its disclosure controls and procedures were not effective—contrary to statements made in previous filings with the SEC. On this news, InfuSystem’s stock fell $1.00 per share, or over 38%, to close at $1.60 per share on November 7, 2016.
InfuSystem Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Leonid Kandinov at (800) 350-6003, or you can complete the form below and we will contact you directly.
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