Simpson Thacher Secures Dismissal of Putative Securities Class Action Against Eargo
09.13.23
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Simpson Thacher won a dismissal on behalf of the defendant underwriters, J.P. Morgan Securities LLC, BofA Securities, Inc., Wells Fargo Securities, LLC and William Blair & Company L.L.C., of a putative securities class action in the Northern District of California brought against Eargo, a medical device company that manufactures and sells hearing aids, certain executives and current and former directors of Eargo, and the underwriters following Eargo’s initial public offering. Plaintiffs allege that Eargo made false and misleading statements concerning the available insurance coverage for Eargo’s products and how such coverage drove Eargo’s revenue growth. The claims against the underwriters are brought under Sections 11 and 12(a)(2) of the Securities Act of 1933.
On August 31, 2023, Judge Breyer granted the Motion to Dismiss the Amended Complaint without holding oral argument—the second time that the plaintiffs’ Complaint had been dismissed. In dismissing the Amended Complaint, Judge Breyer noted that the new pleading “suffers from the same pitfalls” identified in the Court’s earlier dismissal of the first Complaint in February 2023.
The Simpson Thacher team included Jonathan Youngwood, Simona Strauss, Jonathan Sanders and Rachel June-Graber.