Pomerantz LLP and Glancy Prongay & Murray LLP announce that the United States District Court for the Northern District of California has approved the following announcement of a proposed class action settlement that would benefit purchasers of Fitbit, Inc. securities (Fitbit Class A Common Stock NYSE:FIT).
On May 10, 2016, Pomerantz LLP was appointed Co-Lead Counsel in a class action lawsuit against Fitbit, Inc. (“Fitbit” or the “Company”) and certain of its officers. The class action, filed in United States District Court, Northern District of California, and docketed under 16-cv-00151, is on behalf of a class consisting of all persons or entities who purchased Fitbit securities between June 18, 2015 and January 6, 2016 inclusive (the “Class Period”). This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1934.
Fitbit manufactures and provides wearable fitness-tracking devices worldwide. The Company’s main products are wrist bands and clippable devices that purport to monitor a user’s fitness activity by tracking his/her health and fitness activities. Among the Company’s products are Fitbit Charge HR (“Charge HR”), a wireless heart rate and activity wristband, and Fitbit Surge (“Surge”), a fitness watch that consists of a GPS watch, heart rate tracker, activity tracker, and smartwatch. Fitbit Inc. sells its products primarily through retailers and distributors.
The complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: (i) Fitbit’s heart rate monitoring technology was inaccurate and did not consistently deliver accurate heart rate readings during exercise; (ii) the inaccuracy of Fitbit’s heart rate monitoring technology posed serious health risks to users of Fitbit’s products; and (iii) as a result of the foregoing, Fitbit’s public statements were materially false and misleading at all relevant times.
On January 6, 2016, a class action lawsuit was reported as filed against Fitbit in the U.S. District Court for the Northern District of California, alleging that the heart rate monitoring systems on the Company's Charge HR and Surge devices were dangerously inaccurate and posed serious health risks to users (McLellan et al. v. Fitbit, Inc., 3:16-cv-00036) (N.D. Cal. Jan. 5, 2016) (the “Fitbit Consumer Class Action”). The claims against Fitbit include violations of California's Unfair Competition Law and Consumers Legal Remedies Act, common law fraud, and unjust enrichment.
On this news, Fitbit’s stock fell $1.40, or 5.8%, to close at $22.90 on January 6, 2016.