Zynex(US:ZYXI) Prnewswire·2026-03-30 18:26Core Viewpoint - A securities class action lawsuit has been filed against Zynex, Inc. following its bankruptcy and allegations of a significant overbilling scheme targeting government payors [2][3] Summary of Allegations - The lawsuit alleges that Zynex engaged in a systematic "oversupplying" scheme, shipping excessive medical supplies to inflate billings, with some patients receiving up to 128 electrode pairs per month regardless of medical necessity [5] - Zynex's management is accused of failing to disclose the severity of issues related to overbilling and lacked effective internal controls to prevent manipulation of supply orders and billing data [5] - The company faced a suspension of payments from its largest payor, Tricare, in early 2025, which was concealed by management until a settlement of over $85 million was agreed upon to resolve fraud allegations [5] - Following these revelations, Zynex filed for Chapter 11 bankruptcy and was delisted from the Nasdaq, resulting in significant losses for common equity holders [5] Legal Proceedings - The class action lawsuit, titled Beidel v. Sandgaard, et al., was filed in the U.S. District Court for the District of Colorado, seeking to recover losses for investors who purchased Zynex securities between February 25, 2021, and December 15, 2025 [2][4] - A critical deadline for investors to apply as Lead Plaintiff is set for April 21, 2026 [4] Management Indictments - Former CEO Thomas Sandgaard and former COO Anna Lucsok were indicted for health care and securities fraud on January 21, 2026, leading to their removal from the company [5]