Omnicell, Inc.

On July 11, 2019, GlassHouse Research LLC published a report alleging that Omnicell prematurely recognized over $38 million in sales. The report also alleged that new product lines had been pushed onto customers, who were hesitant to purchase more inventory because of implementation issues, and that the Company will need to write off $23 million in obsolete inventory.

On this news, the Company’s stock price fell $11.41 per share, or nearly 14%, to close at $75.11 per share on July 11, 2019, thereby injuring investors.

The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that the Company recognized revenue for certain transactions before fulfilling its performance obligations; (2) that the Company engaged in improper accounting practices to meet revenue targets; (3) that the Company experienced weaker demand for new product lines than it had previously projected; (4) that, as a result, the Company would be required to write-off certain inventory; (5) that the Company misclassified certain expenses as capitalized expenditures; and (6) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.