Understanding the Class Action Filed Against Fortrea Holdings, Inc. and Its Senior Executives

Class Action Lawsuit Against Fortrea Holdings, Inc.

On July 31, 2025, the Pomerantz Law Firm announced the filing of a class action lawsuit against Fortrea Holdings, Inc. (NASDAQ: FTRE) and specific officers associated with the company. This legal action is lodged in the United States District Court for the Southern District of New York, with the case recorded under docket number 25-cv-04630. The class action aims to represent all individuals and entities affected who purchased or acquired Fortrea securities between July 3, 2023, and February 28, 2025, also referred to as the "Class Period."

The lawsuit seeks to recover damages resulting from violations of federal securities laws committed by the defendants, as per Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, along with Rule 10b-5. Investors who participated in the acquisition of Fortrea securities during the designated period are encouraged to act promptly, as they have until August 1, 2025, to petition the court for the role of Lead Plaintiff in this matter. Interested parties are advised to seek a copy of the complaint from www.pomerantzlaw.com.

Among the key allegations, the complaint asserts that the defendants made materially false and misleading statements about Fortrea's operations, business, and prospects during the Class Period. Specifically, it claims that Fortrea claimed that it could similarly achieve revenue growth through its ongoing projects, referred to as Pre-Spin Projects, which were expected to generate significant earnings in 2025.

In June 2023, Fortrea was established following its spin-off from Labcorp, a significant life sciences and healthcare organization. This transition was intended to provide Fortrea with heightened operational flexibility and efficiency. By emphasizing its larger scale and global reach, Fortrea highlighted its commitment to advancing partnerships in developing therapies. Despite these claims, the lawsuit points out that the company's forecasts may have been overinflated due to its optimistic outlook on the Pre-Spin Projects' revenue and anticipated cost savings from exiting Transition Services Agreements (TSAs) with Labcorp.

As mentioned in the complaint, significant issues arose when brokerage Jefferies released a report on September 25, 2024, downgrading Fortrea's stock to "hold" due to concerns regarding its business model and the perceived inadequacy of the expected cost savings from exiting the TSAs. On the heels of this revelation, Fortrea's stock value saw a steep decline, showcasing the disillusionment among investors who had previously backed the organization.

In December 2024, additional turmoil unfolded as Baird Equity Research also downgraded Fortrea amid persistent issues regarding communication and sector concerns. This report similarly impacted the company's stock price, contributing to an onslaught of unfortunate revelations for investors.

The financial outcomes for Fortrea have remained grim as 2025 approached, with disappointing earnings reports noting that revenue and adjusted EBITDA targets did not align with prior expectations. By March 3, 2025, Fortrea disclosed challenges with its Pre-Spin Projects, indicating they were not as lucrative as originally estimated, thus confirming concerns about financial stability moving forward.

Post-Class Period, Fitch Ratings further downgraded Fortrea while suggesting significantly reduced projections for EBITDA margins in 2025. This unfortunate series of events highlights not only the volatility surrounding Fortrea but also the complications that have enveloped its operational narrative.

Pomerantz LLP has become known as a leading firm in securities class action litigation, protecting the rights of investors against misconduct. The firm has advocated for those adversely affected due to volatility in securities prices and breaches of fiduciary duties. Investors who believe they may have been affected by Fortrea's questionable practices during the Class Period are encouraged to contact Pomerantz for guidance on their potential participation in the lawsuit.

Conclusion
As this class action evolves, it will shed further light on the transparency and accountability that investors deserve from firms like Fortrea. The unfolding litigation marks a critical juncture for stakeholders invested in the complexities surrounding Fortrea Holdings and serves as a pivotal reminder of the importance of vigilance in corporate environments.

For more information regarding Pomerantz LLP's litigation efforts or to discuss potential involvement in the lawsuit, contact Danielle Peyton at [email protected] or call 646-581-9980.