According to the Complaint, Illumina, Inc. is a genetic and genomic analysis company with a portfolio of integrated sequencing and microarray systems, consumables, and analysis tools designed to accelerate and simplify genetic analysis. In 2015, Illumina formed GRAIL, Inc. (“GRAIL”) as a corporate subsidiary to develop a blood-based cancer detection test. After several capital financing rounds, Illumina spun off GRAIL in February 2017 and retained a stake of approximately 20%. After GRAIL raised $1.9 billion through venture capital and strategic partners, Illumina announced plans to reacquire GRAIL in September 2020. The acquisition was completed on August 18, 2022.
On October 17, 2023, an investor filed a Complaint against current and former directors of Illumina, alleging direct and derivative claims of breaches of fiduciary duty. The Complaint was filed under seal, but according to Reuters, the investor “told the 13D Monitor Active-Passive Investor Summit in New York on Tuesday that the lawsuit pertained to Illumina completing its acquisition of cancer diagnostic test maker Grail.”
This Complaint 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, the Complaint alleges Defendants failed to disclose to investors: (1) that certain of the Company’s insiders had personal financial motives for acquiring GRAIL; (2) that the Company's insiders’ interests did not align with the Company’s best interests; and (3) 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.