Investor files suit against Invacare
ELYRIA, Ohio – A shareholder of Invacare Corporation has filed a lawsuit in the U.S. District Court for the Northern District of Ohio over alleged violations of federal securities laws by the company, according to a press release.
On behalf of certain Invacare investors, the plaintiff accuses Invacare and certain senior executives of violating provisions of the Securities Exchange Act of 1934 by issuing “false and misleading press releases, financial statements, filings with the Securities and Exchange Commission (SEC), and statements during investor conference calls,” according to the release. The allegedly false statements were made between July 22, 2010, and Dec. 7, 2011, the release noted.
More specifically, the plaintiff alleges that Invacare and certain senior executives misled investors with respect to the company’s noncompliance with Food and Drug Administration (FDA) guidelines and Current Good Manufacturing Practices (CGMP.)
The plaintiff accuses the company of concealing from investors a series of FDA warnings, known as Forms 483, which identified compliance violations, and with masking the fact that the company suffered from “widespread operational, quality, and regulatory deficiencies,” the release noted.
In the months after July 8, 2011, when Invacare shares reached a high of $34.00 per share, the plaintiff alleges that the company “downplayed the scope and significance of Invacare’s compliance issues, despite its receipts of two additional Forms 483 in August 2011, which were allegedly concealed from investors,” the released stated.
Earlier this month, Invacare, as part of a consent decree with the FDA, announced that the federal agency had approved the first of three audits, allowing the company to resume certain production at its Taylor Street facility. The company is waiting to hear about the second audit submitted for approval, which would allow the company to resume design activities. The third and final audit, a review of the company’s compliance with the FDA’s Quality System Regulation, is underway.