#Securities Fraud #LifeMD #LFMD

LifeMD Faces Class Action Lawsuit Over Alleged Misleading Statements

A recent development has unfolded in the telehealth sector as LifeMD, Inc. (NASDAQ: LFMD), is confronted with a federal class action lawsuit. This suit, filed in the Eastern District of New York, centers around serious allegations that the company misled investors regarding its financial and operational performance. With a significant drop in stock price following an unfavorable earnings report, the lawsuit has raised questions about the integrity and transparency of LifeMD's leadership.

Context of the Lawsuit

The class action lawsuit purports that between May 7, 2025, and August 5, 2025, LifeMD and its executives provided inaccurate and overly optimistic representations about the company's financial health. Specifically, during a pivotal earnings report on May 6, 2025, LifeMD announced strong first-quarter results while adjusting its revenue and EBITDA forecasts upward. Claimed to have established a “category-defining competitive moat” in virtual obesity treatment, LifeMD’s management painted a rosy picture of growth and profitability.

However, the lawsuit argues that this portrayal failed to account for critical underlying operational problems. Key complaints raised include rising customer acquisition costs in the company’s RexMD segment and an unexpectedly high refund rate in its weight management services, both of which had not been disclosed to investors. As the lawsuit suggests, these unaddressed issues significantly affected LifeMD's operational capabilities and financial forecasts.

The Unraveling

The alleged misinformation came to light dramatically on August 5, 2025. On this date, LifeMD reported its second-quarter performance, which not only fell short of revenue and earnings expectations but also resulted in slashed projections for the remainder of the fiscal year. During the earnings call, management outlined