April 19, 2021 - An amended complaint was filed.

September 30, 2020 - An investor in shares of Tactile Systems Technology, Inc. (NASDAQ: TCMD) filed a lawsuit in the U.S. District Court for the District of Minnesota over alleged violations of Federal Securities Laws by Tactile Systems Technology, Inc. in connection with certain allegedly false and misleading statements made between May 7, 2018 and June 8, 2020.

Minneapolis, MN based Tactile Systems Technology, Inc., a medical technology company, develops and provides medical devices for chronic diseases in the United States. Tactile Systems Technology, Inc. reported that its annual Total Revenue rose from $143.75 million in 2018 to $189.49 million in 2019, and that its Net Income increased from $6.62 million in 2018 to $10.97 million in 2019.

On March 20, 2019, an amended Qui Tam complaint against Tactile Systems Technology, Inc. was unsealed, alleging that the Company illegally paid hospital staff to induce physicians to prescribe its medical devices and had submitted fraudulent claims to Medicare and Veteran’s Administration (“VA”).

Then, on February 21, 2020, the court denied Tactile Systems Technology, Inc’s motion to dismiss the Qui Tam complaint in its entirety. Analysts warned that “[o]nly two options remain—either this qui tam gets settled out of court, or it goes to discovery.”

On June 8, 2020, a report was issued entitled Strong Sell On Tactile Systems: Bloated Stock Needs Compression Therapy. Specifically, the report stated, We address the likely true source of Tactile's growth: a kickback arrangement, we believe, is resulting in rampant over-prescribing. Payers, including the VA, are cracking down and cutting reimbursement to Tactile. The report went on to say, Medicare has launched an audit, and data reveals Tactile has been found non-compliant on 71% of its claims. We believe management has made no mention of these audits to investors. Shares of Tactile Systems Technology, Inc. (NASDAQ: TCMD) declined from $54.21 per share on June 5, 2020 to as low as $39.40 per share on June 11, 2020.

According to the complaint the plaintiff alleges on behalf of purchasers of Tactile Systems Technology, Inc. (NASDAQ: TCMD) common shares between May 7, 2018 and June 8, 2020, that the defendants violated Federal Securities Laws.

More specifically, the plaintiff claims that between May 7, 2018 and June 8, 2020, the Defendants failed to disclose to investors that: while Tactile publicly touted a $4 plus billion or $5 plus billion market opportunity, in fact, the total addressable market for Tactile’s medical devices was materially smaller, that to induce sales growth and share gains, the Company and/or its employees were engaged in illicit and illegal sales and marketing activities in violation of applicable federal and state rules and public payer regulations, that the foregoing illicit and illegal sales and marketing activities increased the risk of a Medicare audit of the Tactile’s claims and criminal and civil liability, that Tactile’s profits were in part the product of unlawful conduct and thus unsustainable; and that as a result of the foregoing, that the Company's public statements, including its year-over-year revenue growth and the purported growth drivers, were materially false and misleading at all relevant times, and that that, as a result of the foregoing, the Defendants’ statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.