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Hagens Berman Warns Zynex Investors of Class Action Lawsuit

Hagens Berman, a prominent law firm that advocates for shareholder rights, has alerted investors about an ongoing securities class action lawsuit directed at Zynex, Inc. The suit targets significant allegations against the company’s previous executives, asserting that they engaged in misleading practices that affected stockholders' investments.

The lawsuit aligns with the company's turbulent history, especially following its common stock being delisted from the NASDAQ, which was marked by a federal fraud indictment resulting in bankruptcy. Zynex, which once traded under the ticker symbol "ZYXI" before being forced into over-the-counter trading as "ZYXIQ," is now under scrutiny for financial discrepancies that have raised alarms among shareholders.

Context of the Lawsuit

The matter stems from an alarming pattern of behavior that the lawsuit describes as systematic overbilling practices. Specifically, Zynex allegedly shipped medical supplies—namely excessive electrode pairs—to patients who did not need them, leading to inflated revenues from governmental and private health insurance providers.

The lawsuit document, filed under the title Beidel v. Thomas Sandgaard et al., claims Zynex’s executives violated federal securities laws by repeatedly misleading investors about their financial performance, which was falsely reported as "record growth." The company stood to gain from accusing tactics, perpetrated through fraudulent billing practices even against advisories from major insurers.

Major developments occurred regarding Zynex's financial malpractice, particularly a suspension of payments by Tricare, which constituted 25% of its total revenue. Subsequently, Zynex had to forfeit over $85 million linked to disputed billings and ultimately led to federal indictments against high-ranking officials, including former CEO Thomas Sandgaard.

Implications for Investors

Investors who purchased Zynex shares from February 25, 2021, to December 15, 2025, may be entitled to recovery through the class action lawsuit. Hagens Berman urges affected individuals to act rapidly, as the deadline for lead plaintiff applications is set for April 21, 2026. Those interested in participating are encouraged to reach out to Hagens Berman for further guidance on the process and to understand their rights.

Reed Kathrein, the partner spearheading the investigation at Hagens Berman, remarked, "The lawsuit delineates how Zynex's financial growth was primarily a result of 'predatory billing practices' instead of legitimate operations. With claims of $1.2 billion now devolving into bankruptcy and federal charges, it is critical for investors to be informed."

Actions to Take

Current and former investors holding Zynex shares are advised to visit the Hagens Berman Zynex case webpage for further information, including access to the complaint and details about the lead plaintiff process. Furthermore, whistleblowers with insider knowledge relating to Zynex’s activities are invited to share their insights, prompted by potential rewards under the SEC Whistleblower program.

About Hagens Berman

Hagens Berman is well-regarded for its commitment to holding corporations accountable and advocating for investor rights. The firm has successfully recovered over $2.9 billion for clients affected by corporate misconduct and continues to represent diverse demographics, including investors and whistleblowers.

For further queries or to report related information, contact Reed Kathrein through the provided channels. Make sure to mark the impending April 21 deadline on your calendar, as it could be crucial for reclaiming your losses during this turbulent investment period.