According to a press release dated December 13, 2008, the Complaint charges AtriCure and certain of its executive officers with violations of federal securities laws. Among other things, plaintiff claims that defendants' material omissions and dissemination of materially false and misleading statements concerning the Company's business, operations and prospects, caused AtriCure's stock price to become artificially inflated, inflicting damages on investors. AtriCure is a medical device company engaged in the development, manufacture and sale of cardiac surgical ablation systems designed to create precise lesions, or scars, in cardiac tissue.
The Complaint alleges that defendants fraudulently inflated AtriCure's securities prices by improperly promoting its products to physicians and improperly causing the filing of false claims for reimbursement. On October 31, 2008, AtriCure shocked investors when the Company revealed that it had received a letter from the U.S. Department of Justice - Civil Division (the "DOJ") informing the Company that the DOJ was conducting an investigation for potential False Claims Act and common law violations relating to the Company's surgical ablation devices. AtriCure further disclosed that, specifically the DOJ was investigating the Company's marketing practices utilized in connection with AtriCure's surgical ablation system to treat atrial fibrillation, a specific use outside the Federal Food and Drug Administration's 510(k) clearance. Moreover, the Company revealed that the DOJ was investigating whether AtriCure instructed hospitals to bill Medicare for surgical ablation using incorrect billing codes. As a result of this news, the Company's shares declined $2.53 per share, or 39.41 percent, to close on November 3, 2008, at $3.89 per share, on unusually heavy trading volume.
On February 17, 2009, the court consolidated related cases, appointed lead plaintiffs and approved their selection of lead counsel.
On May 08, 2009, amended class action complaint for violations of the federal securities laws against all defendants, was filed by all plaintiffs.
On March 29, 2010, an order was entered granting the motion to strike and granted in part and denied in part the defendants' motion to dismiss.
On July 30, 2010, the parties consented to the entry of an Order Preliminarily Approving Settlement and Directing Notice and Settlement Hearing.
On October 13, 2010, a Final Judgment and Order was entered into the docket outlining the terms of the settlement between the parties.