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Semler Scientific Faces Federal Securities Class Action Amid DOJ Investigation
Investors in Semler Scientific, Inc. (NASDAQ: SMLR) are facing potential losses following revelations that the company is under investigation by the U.S. Department of Justice for possible violations of the False Claims Act. A federal securities class action lawsuit has been filed against the medical technology company, alleging that executives made misleading statements to investors by failing to disclose material information.
According to court documents, the lawsuit claims that Semler Scientific and its executives violated federal securities laws between March 10, 2021, and April 15, 2025. The primary allegation centers on the company’s failure to disclose an ongoing DOJ investigation into potential False Claims Act violations, while simultaneously discussing such violations in hypothetical terms in public statements.
The investigation came to light on February 28, 2025, when Semler Scientific filed its 2024 annual report with the Securities and Exchange Commission (SEC). The report revealed that the company had engaged in initial settlement discussions with the DOJ on February 11, 2025, but those discussions were discontinued the same day.
In the filing, Semler acknowledged: “There is a risk that DOJ will file a complaint or complaint in intervention in a civil False Claims Act lawsuit seeking damages.” The company also stated that it “does not believe the amount of loss can be reasonably estimated.”
Market reaction was swift, with Semler Scientific’s stock dropping more than 9% on the trading day following this disclosure. This significant decline highlights investors’ concerns about potential financial and reputational damage from the DOJ investigation.
Faruqi & Faruqi, LLP, a national securities law firm, is investigating potential claims against Semler Scientific and is representing affected investors. The firm has established an October 28, 2025, deadline for investors to seek the role of lead plaintiff in the class action.
“The lead plaintiff is the investor with the largest financial interest who directs and oversees the litigation on behalf of the class,” explained a representative from the law firm. Faruqi & Faruqi has a track record of recovering hundreds of millions of dollars for investors since its founding in 1995.
Semler Scientific specializes in developing and marketing products that assist healthcare providers in the evaluation and treatment of chronic diseases. The company’s position in the healthcare sector makes allegations of False Claims Act violations particularly serious, as such violations typically involve submitting false claims for payments to government programs like Medicare or Medicaid.
The False Claims Act is one of the government’s primary legal tools to combat fraud against federal programs. Violations can result in substantial financial penalties, including treble damages and civil penalties for each false claim.
Legal experts note that DOJ investigations into healthcare companies often result in significant settlements. Recent years have seen increased enforcement actions in the healthcare sector, with companies facing penalties ranging from millions to billions of dollars depending on the nature and scale of the violations.
Investors who suffered losses in Semler Scientific during the specified period are being encouraged to contact Faruqi & Faruqi to discuss their legal options. The firm is also seeking information from whistleblowers, former employees, shareholders, and others who may have relevant information about Semler Scientific’s conduct.
The case underscores the importance of corporate transparency and the potential consequences when companies fail to disclose material information to investors. As the legal proceedings develop, Semler Scientific may face not only financial penalties but also increased regulatory scrutiny and potential long-term damage to investor confidence.
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13 Comments
False Claims Act violations are no joke. I’m curious to learn more about the specifics of what Semler Scientific is alleged to have done. Hopefully the DOJ and courts can get to the bottom of this in a fair and impartial manner.
It’s troubling to hear about the DOJ investigation and securities lawsuit against Semler Scientific. Allegations of misleading investors are always worrying. I hope the company is able to resolve this issue swiftly and transparently.
Agreed. Maintaining investor trust is critical, especially for a public company. Semler Scientific will need to address this proactively and decisively.
The medical device industry has had its fair share of legal and regulatory issues over the years. It’s important that companies like Semler Scientific maintain high ethical standards and comply with all applicable laws. Investors will be watching this closely.
Absolutely. Compliance and transparency should be top priorities, especially for public companies. Shareholders deserve to have confidence in a firm’s practices.
The medical technology industry can be a minefield when it comes to regulatory compliance. Semler Scientific will need to handle this investigation very carefully to protect its reputation and shareholder value.
Interesting development with the Semler Scientific investigation. It’s concerning to hear about potential False Claims Act violations and a federal securities lawsuit. I wonder what the details of the DOJ probe are and how this will impact the company going forward.
Yes, this seems like a serious issue that could lead to significant penalties and reputational damage for Semler Scientific. Investors will be watching closely to see how the company responds.
The medical technology industry can be a minefield when it comes to regulatory compliance. It’s important for companies like Semler Scientific to be fully transparent with investors, even if it means disclosing an ongoing government investigation. Hopefully this gets resolved without too much damage.
Agreed. Transparency is key, even if it means admitting to potential missteps. Investors deserve to have the full picture before making decisions.
This is an important issue for investors in Semler Scientific to follow closely. Federal investigations and securities lawsuits can have major impacts on a company’s financials and long-term prospects. Transparency will be key as this situation develops.
Absolutely. Investors will be closely scrutinizing Semler Scientific’s response and communications throughout this process. Maintaining credibility is critical.
This is a concerning development for Semler Scientific. Federal investigations into potential False Claims Act violations are serious matters that can have significant financial and reputational consequences. I’ll be interested to see how this plays out.