A class action lawsuit was filed against Exscientia PLC (NASDAQ:EXAI) on April 26, 2024. The plaintiffs (shareholders) alleged that they bought Exscientia American Depository Shares (ADS) at artificially inflated prices between March 23, 2022, and February 12, 2024 (Class Period) and are now seeking compensation for their financial losses. Investors who bought EXAI stock during that period can click here to learn about joining the lawsuit.
Exscientia is an artificial intelligence (AI)-powered precision medicine company. The company boasts developing the first-ever functional precision oncology platform, with various successes in a prospective interventional clinical study.
The plaintiffs maintain that Exscientia and three of its current and/or former senior officers and/or directors deceived investors by lying and withholding vital information about the company’s business practices and prospects during the Class Period. Particularly, they are accused of omitting truthful information about the efficacy of the Company’s Code of Business Ethics and Conduct, and the conduct of one of the Company’s senior officers from the SEC filings and related material.
The information became clear on February 13, 2024, when the company abruptly announced the termination of its CEO, effective immediately. Exscientia noted that the termination was related to the alleged “relationships with two employees that the Board determined were inappropriate and inconsistent with the Company’s standards and values.”
The company added that the investigation had determined that the Chairman of the Board of Directors knew about the CEO’s earlier transgression and that he “had addressed the situation directly, and with the involvement of other outside counsel, rather than in consultation with the Board.” Accordingly, the Chairman also voluntarily resigned from the Board on February 12.
Interestingly, during the Class Period, Exscientia has always stressed the importance of the Code of Business Conduct and Ethics for the company and its employees. In an annual report, the company also noted that “the loss of the services of our executive officers or other key employees could impede the achievement of our development and sales goals in our software business…”
As per the class action lawsuit, Exscientia caused its ADS to trade at artificially inflated prices by knowingly and recklessly misleading investors about the company’s business practices during the Class Period.
Notably, EXAI stock cratered 22.8% on February 13, causing massive damage to shareholders’ returns.
