NEW YORK, May 01, 2020 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against SCWorx Corp. (“SCWorx” or the “Company”) (NASDAQ: WORX) in the United States District Court for the Southern District of New York on behalf of those who purchased or acquired the securities of SCWorx between April 13, 2020 and April 17, 2020, inclusive (the “Class Period”). The lawsuit seeks to recover damages for SCWorx investors under the federal securities laws.
The Complaint alleges On April 13, 2020, before the market opened, SCWorx announced that it had received a committed purchase order of two million COVID-19 rapid testing kits, “with provision for additional weekly orders of 2 million units for 23 weeks, valued at $35M per week.” On this news, the Company’s shares closed at $12.02 per share, up $9.77, on April 13, 2020.
On April 17, 2020, Hindenburg Research issued a report doubting the validity of the deal, calling it “completely bogus.” Hindenburg Research alleged that the COVID-19 test supplier that SCWorx is buying from, Promedical, has a Chief Executive Officer “who formerly ran another business accused of defrauding its investors and customers” and “was also alleged to have falsified his medical credentials.” According to the report, Promedical claimed to the FDA and regulators in Australia to be offering COVID-19 test kits manufactured by Wondfo, but Wondfo “disavowed any relationship” and the buyer that SCWorx claimed to have lined up does not appear to be “capable of handling hundreds of millions of dollars in orders.”
On this news, the Company’s share price fell $1.19, or more than 17%, over three consecutive trading sessions to close at $5.76 per share on April 21, 2020, on unusually heavy trading volume. On April 22, 2020, the SEC halted trading of the Company’s stock and it has remained halted as of today.
Investors who purchased or otherwise acquired shares of SCWorx during the Class Period should contact the Firm prior to the June 29, 2020 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com.
Please visit our website at http://www.gme-law.com for more information about the firm.