iRhythm settles class action lawsuit for $45 million

iRhythm Technologies Inc. (NASDAQ: IRTC) entered into a settlement agreement on June 3 to resolve a class action securities lawsuit for $45 million, according to a company statement.

The settlement resolves the case Glazing Employers and Glaziers' Union Local #27 Pension and Retirement Fund v. iRhythm Technologies, Inc., which was filed in the U.S. District Court for the Northern District of California. The lawsuit named iRhythm Technologies and Chief Executive Officer Quentin Blackford as defendants.

Under the settlement terms, iRhythm will pay $45 million, which includes plaintiff attorneys' fees and litigation expenses. The company expects its directors and officers insurance policies will cover most of the payment amount. The settlement includes a complete dismissal of the case and release of all claims without any admission of fault or wrongdoing by the defendants.

The settlement does not resolve separate stockholder derivative lawsuits that remain pending against the company.

iRhythm stated the settlement was reached to eliminate the uncertainty and expense of continued litigation. The company said it excludes litigation-related charges from its non-GAAP financial measures and does not expect the settlement to impact adjusted EBITDA, adjusted net income, or adjusted operating expenses.

The proposed settlement requires court approval. The lead plaintiff has filed a motion seeking preliminary approval from the district court.

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