Shareholder Class Action Alleging Impinj, Inc. (PI) Made Materially False and Misleading Statements Survives Motion to Dismiss
Investors filed a class action complaint against Impinj for alleged violations of the Securities Exchange Act of 1934. According to the class action complaint, between July 21, 2016 and February 15, 2018, Impinj touted its platform’s ability to identify a tagged item’s unique location with a margin of error of 1.5 feet and purported this accuracy would allow the Company to tap into valuable new markets, including healthcare. However, the platform was not able to accurately locate tagged items, which its officers knew and failed to disclose prior to Impinj’s public offering and throughout the relevant period. This inability to identify the unique location of tagged items made the product less valuable to end users, and it therefore did not have the market demand that Impinj purported. As a result, on November 1, 2017, Impinj revealed weaker-than-expected revenues for Q3 2017 and reduced its revenue projection for Q4 2017, due to a decline in IC demand. Then, on February 1, 2018, Impinj announced a Q1 2018 guidance significantly lower than previous Q1 2017 and Q4 2017 quarters. Following these disclosures, Impinj’s stock price plummeted to $12.16 per share, an almost 75% decline from what it traded at the beginning of its disclosures. On October 3, 2019, U.S. District Court Judge Robert S. Lasnik denied in part Impinj’s motion to dismiss plaintiffs’ claims, paving the way for litigation to proceed.
