In Re Quidelortho Corporation Securities Litigation — Entry #76: OPINION AND ORDER: Accordingly, Defendants Motion to Dismiss is GRANTED IN PART AND DENIED IN PART

Case 1:24-cv-02804-JAV                Document 76           Filed 09/30/26   Page 1 of 100


UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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                                                                       :        24-CV-02804 (JAV)
IN RE QUIDELORTHO CORPORATION                                          :
SECURITIES LITIGATION                                                  :     OPINION AND ORDER
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JEANNETTE A. VARGAS, United States District Judge:

        Court-appointed Lead Plaintiff Central States, Southeast and Southwest

Areas Health and Welfare Fund (“Central States”) and Teamsters Local 710

Pension Fund (“Local 710”) (collectively, the “Teamsters Funds” or “Lead Plaintiff”)

brings this federal securities class action on behalf of itself and a class consisting of

all persons and entities damaged by their acquisition of the publicly traded common

stock of Quidel Corporation (“Quidel”) and/or its successor QuidelOrtho Corporation

(“QuidelOrtho”) (collectively, the “Corporate Defendant” or the “Company”) during

the period from after market close on February 17, 2022, through April 1, 2024 (the

“Class Period”). The Teamsters Funds allege material misrepresentations by

QuidelOrtho’s senior executives and bring claims for violation of Sections 10(b) and

20(a) of the Securities Exchange Act of 1934 (“the Exchange Act”) and Rule 10b-5

promulgated thereunder, 17 C.F.R. § 240.10b-5, against the Corporate Defendant as

well as QuidelOrtho’s former Chief Executive Officer (“CEO”) Douglas Bryant


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(“Bryant”); the Company’s Chief Financial Officer (“CFO”) Joseph Busky (“Busky”);

the Company’s former CFO Randall Steward (“Steward”); the Company’s former

Chief Operating Officer (“COO”) Robert J. Bujarski (“Bujarski”); the Company’s

former Executive Vice President, Chief Commercial Officer, and Interim CEO

Michael Iskra (“Iskra”); and the Company’s Senior Vice President, Molecular

Diagnostics and Point of Care, Tamara Ranalli (“Ranalli”) (collectively, “Individual

Defendants”). ECF No. 42 (“Amended Complaint” or “Am. Compl.”), ¶¶ 413-446.

Presently before the Court are Defendants’ Motion to Dismiss the Amended

Complaint (“Motion to Dismiss”), Plaintiff’s motion to strike, and Defendants’

motion to strike. ECF No. 47, 51-52, 57-58.

      For the following reasons, the motions to strike are DENIED and

Defendants’ Motion to Dismiss is GRANTED IN PART AND DENIED IN PART.

                                  BACKGROUND

      The following allegations from the Amended Complaint are presumed true

and construed in the light most favorable to Lead Plaintiff. Slayton v. Am. Express

Co., 604 F.3d 758, 766 (2d Cir. 2010) (“In considering a motion to dismiss a 10(b)

action, we must accept all factual allegations in the complaint as true and must

consider the complaint in its entirety.” (citing Tellabs, Inc. v. Makor Issues &

Rights, Ltd., 551 U.S. 308, 322 (2007)).

A.    Quidel’s Pre-Merger Business and the COVID-19 Pandemic

      QuidelOrtho is a Delaware corporation that emerged from the 2022 merger of

Quidel and Ortho. Am. Compl., ¶ 36. Quidel developed and marketed diagnostic


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testing solutions, including rapid immunoassay tests (notably the Sofia platform),

cardiometabolic immunoassays, molecular diagnostic solutions (Lyra and Solana

platforms), and specialized diagnostic solutions. Id., ¶ 68. Prior to the COVID-19

pandemic, Quidel’s annual revenues were steady, with $534.9 million reported in

2019. Id., ¶ 69. During this time period, Quidel did not typically provide the

market with revenue projections on a yearly basis. Id.

      With the onset of the COVID-19 pandemic in early 2020, Quidel received

Emergency Use Authorization (“EUA”) for several COVID-19 diagnostic tests,

including the Lyra, Sofia, and Solana platforms. Id., ¶ 70. COVID-19 test sales

drove a dramatic increase in revenues: $1.163 billion in 2020 (70% of total revenue)

and $1.274 billion in 2021 (75% of total revenue). Id., ¶ 74. The company’s stock

price rose accordingly, peaking at $283.45 per share in November 2020. Id., ¶ 3.

      By mid-2021, Quidel anticipated a transition from pandemic to endemic

COVID-19, with a reduction in testing demand akin to other, more common

respiratory illnesses. Id., ¶ 4. The company sought to maintain its revenue and

stock performance as pandemic-driven sales waned. Id.

B.    Quidel’s Merger with Ortho and the Role of Savanna

      In May 2021, Quidel began exploring a merger with Ortho Clinical

Diagnostics Holdings PLC (“Ortho”), a leading in-vitro diagnostics company. Id.,

¶¶ 5, 75. The merger was publicly announced on December 23, 2021, and completed

on May 27, 2022, with QuidelOrtho as the successor entity. Id., ¶ 75. The merger

was justified in part by the anticipated synergies from Quidel’s soon-to-launch


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Savanna molecular diagnostic platform, which was expected to drive $75 million of

the $100 million in projected revenue synergies. Id., ¶ 78.

      First announced in 2011, the Savanna platform was marketed as a low-cost,

rapid, multiplex PCR (Polymerase Chain Reaction) testing solution capable of

detecting multiple respiratory pathogens in approximately 30 minutes. Id., ¶ 79.

The platform’s flagship laboratory test, the Savanna Respiratory Viral Panel-4

(“RVP4”), was designed to test for influenza A and B, COVID-19, and RSV from a

single sample. Id., ¶ 80. According to the Company’s former Senior Director,

Regulatory Affairs from January 2020 to April 2024 (“FE-1”), 1 the Company’s

ability to be first to market with Savanna’s new molecular diagnostic technologic

was critical to its success, as several competitors were similarly attempting to

develop products that could provide quick test results with the same high level of

accuracy as PCR tests. Id., ¶ 129. FE-1, FE-2 (a former Senior Director, Systems

Engineering from February 2020 through September 2023), and FE-4 (a scientist

who led Savanna RVP4’s EU launch, among other roles from mid-2020 to fall 2023)

added that the Savanna launch faced additional pressure because QuidelOrtho’s

dominant point of care immunoassays—the Sofia 1 and Sofia 2 analyzers—were

reaching their production “end of life.” Id., ¶¶ 138-146. Defendant Bryant

repeatedly characterized Savanna as “the most important product introduction

in our history” and attributed most of the $100 million in expected revenue


1Former employees are hereinafter referred to, per the Amended Complaint, as
“FE-__.” See Am. Compl. at 2 & ¶¶ 46-66.


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synergies to Savanna’s launch. Id., ¶ 82.

      Quidel obtained limited European approval for Savanna and its RVP4 test in

July 2021, allowing sales and marketing in certain European countries (the

“European launch” or “EU launch”). Id., ¶ 83. In the lead-up to the merger,

Defendants made several statements regarding the European launch, citing “very

positive customer feedback” and positioning Savanna as a major growth driver

for the merged company.2 Id., ¶¶ 7, 84.

C.    Public Statements and Disclosures Regarding Savanna RVP4,
      Manufacturing Capabilities, and COVID-19 Revenues

      Throughout the Class Period, QuidelOrtho and its executives made numerous

public statements asserting that the European launch of Savanna RVP4 was

successful, that customer feedback was positive, and that the platform was ready

for U.S. Food and Drug Administration (“FDA”) approval and to launch in the

United States. For example, on February 17, 2022, CEO Bryant stated: “Based on

customer reviews in Europe, we believe Savanna will be a major growth

driver, both in the U.S. and globally, for years to come.” Id., ¶¶ 7, 91. On

March 9, 2022, during the Raymond James Annual Investors Conference, Bryant

reported that Savanna is “performing very nicely in Europe right now. We’re

hearing really nice feedback. I think it’s the right design for the market at

this time.” Id., ¶ 93. Similar statements were made in earnings calls, investor

conferences, and analyst presentations throughout 2022 and 2023. Id., ¶¶ 321-322.


2Certain reproduced statements are bolded and italicized, per the Amended
Complaint, to distinguish alleged misrepresentations from unchallenged text


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      Defendants appeared to assure investors that Savanna RVP4 was on track

for FDA approval and that the company would achieve $75 million in merger

revenue synergies and $300 million in annual Savanna revenues within three years

of U.S. launch. Id., ¶¶ 95, 222, 327-328. These assurances were reiterated as the

Company struggled to meet the FDA’s requirements. Id.

      Essential to achieving these synergies was the Company’s ability to

manufacture the RVP4 test at scale. Id., ¶ 222. Bryant represented that

QuidelOrtho would be prepared to manufacture Savanna RVP4 at scale, with

automated production lines capable of producing over one million cartridges per

month. Id., ¶¶ 222, 339-340. The Company invested $100 million in this

manufacturing capability. Id., ¶ 222.

      In mid-2022, QuidelOrtho initially guided investors to expect $150-$200

million in annual endemic COVID-19 revenues, a significant reduction from

pandemic levels. Id., ¶¶ 109-110. Following a negative market reaction to the

company’s December 13, 2022 Investor Day, however, CFO Busky doubled the

guidance to $200-$400 million without providing supporting data. Id., ¶¶ 114-16,

429. This higher guidance was repeated throughout 2023. Id., ¶ 116. Despite

internal reports of declining COVID-19 test sales and mounting inventory,

Defendants continued to publicly assert that demand remained strong and that the

company was “very comfortable” with the $200-$400 million range. Id., ¶¶ 20, 120.

D.    Internal Reports and Complaints Underlying Public Statements

      FE-10, Finance Director throughout the Class Period until Fall 2023, detailed


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that prior to the Merger, employees at QuidelOrtho turned from optimistic about

Savanna to perceiving that it was “not a real thing.” Id., ¶ 195. During pre-Merger

discussions about Ortho’s interest in a merger with Quidel because of Savanna, FE-

10 and his colleagues remarked, “wait until they see that it doesn’t work.” Id. In

2022, FE-10 heard from a former Finance Manager and current Chief Operations

Officer—who attended Savanna production meetings, weekly meetings with

Savanna manufacturing, and regular meetings with Defendant Ranalli—that

Savanna was failing tests, that it was not doing what it was supposed to do, and

that the Company was spending money on a product that was not going to work.

Id. FE-11, a senior sales manager, affirmed that these issues were “widely known.”

Id., ¶ 197. FE-2 stated that the engineering issues with the RVP4 test were not

fixed when it went on sale in Europe in late 2021, were not fixed when it was sent to

the FDA for approval in the second quarter of 2023, and were not fixed when he left

the Company in September 2023. Id., ¶ 193. FE-10 recalled that Savanna RVP4

had issues throughout his entire tenure. Id. FE-10 stated that he never thought

Savanna would be in production and that every test ran for Savanna was “bad

news.” Id., ¶ 194. FE-6 understood that the Company would halt production of

Savanna RVP4 in April 2024, the month he left the company. Id., ¶ 189.

   1.      EU Launch Failures

        Twenty-one former employees involved in Savanna’s development and

launch—several of whom held senior positions at the Company—described

significant, unresolved design and manufacturing flaws, including high rates of


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invalid test results and device failures. Id., ¶¶ 21, 46-66, 160-209. FE-14, an

engineer at the Company until the second half of 2023, described “fundamental

flaws” in the manufacturing of the Savanna RVP4 assay cassette that the Company

“chose to ignore” prior to the Class Period, instead choosing to transfer Savanna

RVP4 to a smaller team that would stop providing cross-functional information

within the Company and instead “push” the product to production. Id., ¶¶ 132-34.

FE-14 added that the Company skipped quality assurance measures like reliability

testing because the Savanna instrument and cartridge would break and fail if

subjected to them. Id., ¶ 135. FE-6, a Cost Accounting Manager throughout the

Class Period, described the process of bringing Savanna to market as “flying a plane

while building it.” Id., ¶ 165. FE-4 described the EU launch as a “defining

moment” full of technical challenges from its “beginning.” Id.

      FE-4 characterized himself as having the “best pulse” on the EU launch

performance of all his United States-based colleagues because he worked directly

with colleagues in Italy and Germany and communicated with them weekly. Id.,

¶ 171. Along with FE-4, FE-7 drafted promotional marketing materials used for

Savanna sales in Europe, which FE-4 said included “claims about the Savanna

RVP4 test performance and capabilities” that were “just a wish or a dream.” Id.,

¶¶ 166-67. After 20 years in “this line of work,” FE-7 “didn’t remember any market

launch that was so full of issues.” Id., ¶ 190.

      Demand for Savanna in Europe was limited and restricted to late 2021 and

the first quarter of 2022. Id., ¶ 170. FE-4 recalled, and FE-7 corroborated, that the


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Company sold only about 40 to 55 Savanna devices from the July 2021 launch

through mid-2023. Id. Customers throughout this period included about six

hospitals across Austria and eastern Germany around December 2021 and 16

hospitals in Italy in mid-2022. Id.

      In their positions, FE-4 and FE-7 were updated weekly on all of the

complaints and issues with Savanna RVP4 in the European market. Id., ¶ 171.

FE-7 also noted “issues with Savanna from the beginning.” Id., ¶ 172. FE-4

personally became aware of the device’s “widespread failure” between June 2022

and November 2022. Id., ¶ 173. The test’s assay did not work “from the very

beginning,” and one in every four Savanna RVP4 instruments sold in Europe had to

be replaced at cost due to invalid results—a “depressing” outcome for the Company.

Id., ¶¶ 172-73. Indeed, there were times the replacement tests also failed. Id.,

¶ 173. The Company’s inventory and production costs increased as it began to send

backup tests with every instrument in case problems arose. Id., ¶ 188. The

industry standard for invalid results is 1-2%, but the invalid rate for Savanna was

between 10 and 30%. Id., ¶ 176. Jürgen Becker, Scientific Marketing Manager,

Europe, informed FE-4 that Savanna RVP4 customers were “irate.” Id. ¶ 173.

Other manufacturing errors also plagued the rollout, with one in four Savanna

RVP4 test instruments failing due to overheating, frozen screens, and/or spring

ejection issues. Id., ¶ 179.

      European customer complaints stayed steady, and even increased, as the

Class Period progressed. Id., ¶ 177. FE-8, a former member of the Quality


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Assurance team throughout the Class Period, recalled an “uptick” in complaints

from European Savanna customers in approximately August 2023. Id., ¶ 177.

Whereas the Company had previously received between 11 and 13 Savanna RVP4

complaints per month from European customers, it received over 30 such

complaints in August 2023, all recorded in Salesforce. Id. On a scale measuring the

seriousness of customer complaints from “Green” to “Yellow” to “Red,” the Company

assigned the August 2023 Savanna RVP4 complaints a “Red” grade, significant

enough to open a Corrective and Preventative Action (“CAPA”) investigation in

summer 2023 to address the complaints, identify their root cause, and prevent it

from reoccurring. Id., ¶ 178. Those notified of this CAPA included the research and

development team for Savanna RVP4, the Company’s Vice President of Clinical,

Regulatory & Quality Assurance, and the Company’s Director of Operations, who

reported to the Company’s Vice President, Operations Brad Smith. Id. Further,

information about this CAPA was shared internally in monthly or quarterly

internal business unit reports to upper management. Id. FE-8 reported that the

Company was still investigating the root cause of the error codes behind the CAPA

when he left in July 2024. Id. Likewise, FE-9, former Vice President, Sales and

Marketing, Europe throughout the Class Period, confirmed that the steady stream

of customer complaints about Savanna’s invalid results, failing assays, and failing

controls were still being addressed when he left the Company in June 2024. Id.,

¶¶ 178-79.

      Senior management was informed of European customer complaints, which


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continued from the start of the EU launch through the end of the Class Period. Id.,

¶¶ 182-188. In an effort to prevent reputational damage, the Company found itself

“firefighting.” Id., ¶ 182. It enacted a formal complaint system to register customer

issues in the EU, which were then sent to Defendant Ranalli, who reported to

Defendant Bryant. Id., ¶¶ 183, 185. Generally, customers complained to sales

representatives, who then submitted complaint paperwork to the head of service in

the EU, who then reported on complaint statistics for Europe. Id., ¶ 184. All

complaints were also formally reported to the Company’s office in Ireland, where

leadership prepared quarterly reports on the complaints and sent them to the

Company’s United States headquarters. Id., ¶ 183. According to FE-7, there was

no lack of visibility regarding Savanna’s problems, and every single issue with

Savanna was reported to Irish leadership. Id., ¶ 184. Former Vice President, Sales

and Marketing, Europe from October 2017 through June 2024, FE-9, confirmed

Irish leadership was in “constant contact” with the Company’s U.S. Headquarters,

particularly Senior Vice President, Research and Development Werner Kroll, who

then—according to FE-9—relayed such discussions to Defendants Ranalli, Bryant,

and Bujarski. Id., ¶¶ 54, 184.

      After Savanna launched in Europe in late 2021, the Director of Global

Product Management held “many, many . . . Zoom-style” calls about Savanna at

least monthly with a regular group of fewer than ten people, including Defendant

Ranalli and FE-7. Id., ¶¶ 185-87. At these calls, Becker disclosed to Ranalli that

the Savanna RVP4 tests were failing in Europe and provided her with the negative


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customer feedback. Id., ¶ 186. Between 60 and 80% of European customer

feedback on Savanna was negative. Id. FE-7 recalled, during one of these calls in

2023, a PowerPoint presentation that included a quarterly report showing 80 units

of Savanna in distribution and 85 complaints. Id., ¶ 188.

   2.      FDA Approval

        FE-10 explained how, in early 2022, it became “a reality” for the Company

that the manufacturing yields for RVP4 test were too low to receive FDA clearance.

Id., ¶ 194. As Finance Director, FE-10 added that longtime Financial Planning &

Analysis, Accounting and Operations Finance colleagues told him that the Company

had worked on the Savanna test for years and their “consistent sentiment” was that

they did not think the test “would ever work.” Id. QuidelOrtho nonetheless pushed

for FDA clearance even though employees who worked directly or indirectly with

the Savanna RVP4 test knew that the test had “glaring issues.” Id., ¶ 206.

        Internal regulatory and validation teams reportedly informed management

that Savanna RVP4 could not consistently achieve the 95% sensitivity required for

FDA approval, yet the company proceeded with its FDA required form 510(k)

application for clearance to sell Savanna. Id., ¶¶ 200-204, 359-360, 371. FE-11

reported that the test “never came close” to reaching the 95% sensitivity threshold.

Id., ¶ 199.

        As Senior Director, Regulatory Affairs during the Class Period, FE-1

explained that the FDA submissions for Savanna RVP4 were under the purview of

Michelle Bodien (also Senior Director, Regulatory Affairs) and Ron Lollar (Vice


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President, Clinical and Regulatory), who reported to Kroll. Id., ¶ 198. FE-1

reported that Kroll, Lollar, and Bodien—and likely, in his estimation, Defendant

Bryant—made the decision to make the FDA submission in the second quarter of

2023. Id. Conversations FE-1 had in late 2023 confirmed that Company

management—including Kroll and Defendants Bryant and Bujarski—knew that

Savanna RVP4 was not consistently meeting the FDA’s detectability requirements.

Id., ¶¶ 198, 204.

      The Company kept written documentation of the feedback and discussions

with the FDA, including minutes of meetings with the FDA prior to submission.

Id., ¶ 205. Status updates in the form of notes and PowerPoint slides regarding the

Savanna FDA application were also reported regularly to the C-suite and the Board

of Directors, at least monthly. Id. FE-1 recalled Defendant Bryant’s practice of

“open dialogue” with the FDA and that he was typically involved in discussions with

the FDA regarding the Company’s COVID test-related products. Id.

      Associate Director of Assay Verification & Validation, Research &

Development Shawna Prange was responsible for validating Savanna for FDA

submission. Id., ¶¶ 206-08. As part of the validation process prior to submission,

RVP4’s chemistry was subjected to a variety of viral loads to test its sensitivity

under varying conditions and extremes. Id., ¶ 208. According to FE-2, Savanna

could not achieve the needed sensitivity readings or pick up enough results as part

of that process. Id. In summer 2023, Prange—whose studies were core to the

Company’s FDA submission—commented to FE-4 that the Savanna RVP4 test “does


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not work” and that it “isn’t even a product.” Id., ¶ 206. Senior scientist FE-12, who

worked on Savanna throughout 2023 and the first half of 2024, confirmed that

detectability issues like high rates of invalid test results and false positives—in

addition to issues with Savanna on a molecular level—persisted “across the board”

through the end of the Class Period. Id., ¶¶ 209-10.

        According to FE-4, Prange knew the product could not achieve the required

95% confidence interval and “will never get it” but received “a lot of pressure” from

a “top-down mandate” at the Company to approve Savanna “no matter the cost.”

Id., ¶ 207. Several other employees expressed concern to management over the

“many shortcuts” it was taking to rush Savanna to market. Id., ¶ 211. In FE-4’s

scientific opinion, Savanna would not receive FDA clearance, and if it managed to,

it would get recalled. Id., ¶ 212. In September 2023, he told a high-level senior

executive who reported directly to Defendant Bryant that “this thing doesn’t work

. . . this ain’t ever gonna fly. And if it does . . . we’re gonna be facing the risk of a

recall.” Id.

   3.      Scale

        QuidelOrtho’s ability to automate Savanna RVP4 production was essential to

its projected profits after achieving FDA approval. Id., ¶ 222. Indeed, Defendant

Bryant identified the Company’s ability to quickly manufacture and get to market

instruments and cartridges “at very, very high volumes” as the “only constraint”

on Savanna RVP4’s U.S. launch. Id., ¶ 339(d). He estimated the Company would

“outfit . . . over 1 million cartridges per month . . . within 3 years.” Id.,


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¶ 339(e). Specifically, from the start of the Class Period, Defendants told investors

that the Company would realize $75 million of Merger revenue synergies by 2025 in

connection with the Savanna launch, another $30-$50 million in Savanna revenues

by the end of 2024, and $300 million per year within three years of launch. Id.,

¶ 222.

         The Company’s efforts to build an automated manufacturing line for Savanna

were never close to successful. Id., ¶¶ 221-228. The Company’s manual production

of Savanna tests yielded usable tests far below the expected, normal threshold. Id.,

¶ 223. These issues were reported to senior management. Id., ¶ 229. Indeed, FE-4

explained that QuidelOrtho was forced to scrap a “very alarming” 50-80%, and

sometimes 90%, of the Savanna assays it manufactured due to defects. Id., ¶ 223.

FE-12 advised that the Savanna test suffered from both possible contamination

issues and problems on a molecular level. Id., ¶ 210. In the process of scaling up

from pilot batches of assays of about 500 units to production scale, the tests

produced rates of invalid or false positives that were too high for even in-house use.

Id. By the time FE-10 left in fall 2023, RVP4 production efforts had only reached a

manufacturing yield of 50%, “way below” the Company’s ideal yield rate of 90%. Id.,

¶ 223. FE-6 confirmed that production yields for Savanna were 30-40% when they

should have been 70-80%. Id.

         After scrapping nearly half of its RVP4 manufacturing yield, the Company

also needed to scrap many RVP4 tests during final inspection due to a high level of

invalid test results—“the worst result for a clinician.” Id., ¶¶ 174, 224. FE-2


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confirmed that, for example, in a production batch of 1000 units, maybe 500 needed

to be scrapped immediately due to manufacturing errors, and of about 50 selected

for random quality testing from that pool, an additional 10% to 50% would fail. Id.,

¶ 225. The Company was thus scrapping up to 50% of the entire production line,

compared to a 5% standard industry failure rate. Id., ¶ 224. There were times the

Company had to shut the entire production line down because everything was

failing. Id. Meanwhile, the Company’s manual production line increased costs and

the potential for human error and contamination. Id., ¶ 226. The Company

ultimately spent upwards of $80-100 million on the incomplete automated

production line, for which there was never a concrete location. Id., ¶ 228. FE-6

indicated that he raised “red flags” “up the chain” about rising costs associated with

production issues multiple times. Id., ¶ 229. Each month, FE-6 told Defendant

Busky that the Company would charge costs to Research & Development because

Savanna still needed adjustments and research to address its failures. Id.

   4.      Sales

        By late 2022 and throughout 2023, internal reports and sales data for

products such as the Sofia analyzer showed that QuidelOrtho’s COVID-19 test sales

were in decline, with the company losing market share to competitors offering more

advanced or cost-effective products. Id., ¶¶ 236-237, 240-41. Sales teams

consistently missed quotas, and inventory of unsold tests accumulated to concerning

levels. Id., ¶¶ 251-268, 270. These negative trends were communicated to senior

management, including Defendant Busky, through regular reports, meetings, and


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direct conversations. Id., ¶¶ 276-277. Finance and sales personnel provided

detailed analyses of missed quotas and excess inventory and sought guidance from

the C-suite on how to address or “spin” these issues for investors. Id.

      FE-13, a Cost Accountant at the Company from February 2022 through

March 2023, confirmed that Savanna was not passing the Company’s internal

qualifications or testing in 2022 and early 2023. Id., ¶ 213. FE-13 explained that

she learned of the Company’s goal to get Savanna on the market by the end of 2023

and the product’s testing problems during daily “standups” for Triage and monthly

leadership meetings. Id.

      FE-6, another Cost Account Manager, knew that problems with the Savanna

test instrument and chemical assay “always” amounted to a “huge situation” that

doubled the unit cost for the instrument due to quality control issues. Id., ¶ 214.

Whereas FE-6 cited a strong return-on-investment for production as yielding 70-

80% usable tests, Savanna’s yield was only 30-40%. Id., ¶ 215. These poor yield

rates and the amount of scrap material generated by the tests were recorded,

including in emails and the Enterprise Resource Planning system used by the

company, and reported every month to senior management. Id. He input

information regarding cost accounting issues for Savanna into a system that

generated reports for month-end financial close meetings with upper management,

including the Company’s Controller and Global Operations Finance Senior

Manager, who reported directly to Defendant Busky. Id.

      FE-13 corroborated that, because Savanna was supposed to be the Company’s


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next big “money-maker,” issues with Savanna were communicated to the C-Suite

“all the time,” and “everyone” knew about its problems. Id., ¶ 216. FE-2 elaborated

that “every test” of Savanna’s performance was documented, and any change to its

engineering or assay was required to be documented in a design review. Id., ¶ 217.

“[S]tandard practice” was for engineers and scientists to report findings to their

managers, who reported findings through PowerPoints to senior management such

as Kroll and Defendant Ranalli, who then reported information to Defendants

Bujarski, Bryant, and Iskra. Id., ¶ 217-18. Kroll personally reviewed all findings.

Id., ¶ 219. FE-2 met weekly with Kroll before and during the Class Period until his

September 2023 departure. Id. Kroll met quarterly with the Board and senior

management to provide project updates on Savanna, such that senior

management—specifically, Defendant Bryant—was made aware of Savanna’s

failure rate and assay problems when it was submitted to the FDA in mid-2023 and

thereafter. Id. FE-5, a Territory Account Manager and Acute Account Manager at

the Company who pre-sold a high volume of RVP4 tests to customers in 2022,

recalled that the Company wanted salespeople to generate interest but could “never

actually back it up with an actual product.” Id., ¶ 220.

E.    Corrective Disclosures and Market Reaction

      After close of market on February 13, 2024, QuidelOrtho reported

disappointing earnings for fourth quarter and fiscal year 2023 and cut guidance for

endemic COVID-related revenue. Id., ¶ 386. Previous guidance put this revenue

between $200 and $400 million, while the February 13 disclosure moved the


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guidance to $200 million. Id. Defendants Bujarski, Bryant, and Iskra continued to

make positive statements about Savanna RVP4’s FDA approval prospects. Id.,

¶ 373. The next day, on February 14, 2024, QuidelOrtho’s stock price fell 32% in a

single trading session, moving from $66.77 per share on the 13th to $45.27 on the

14th. Id., ¶ 387. Two market analysis firms downgraded the stock, each citing

communications by QuidelOrtho executives. Id., ¶¶ 291-292. The Company

announced the termination of CEO Bryant a week later, with analysts attributing

the move to the week’s disappointing financial results. Id., ¶¶ 300-301.

      On March 4, 2024, UBS released an analyst report that downgraded

QuidelOrtho stock to “sell.” Id., ¶ 296. The report suggested that the Company was

losing market share in COVID-related sales. Id. On April 2, 2024, QuidelOrtho

disclosed that it had withdrawn its FDA 510(k) submission for Savanna RVP4,

citing failure to meet performance expectations. Id., ¶ 303. The stock price dropped

another 10% after this announcement. Id., ¶ 306. On July 31, 2024—after the

Company lowered COVID-19 endemic guidance further, the Savanna RVP4 FDA

resubmission was stalled again, and Savanna revenue projections were pushed out

to 2026—Defendants Bujarski and Iskra were fired. Id., ¶¶ 27, 380.

F.    Roles of Individual Defendants

      Douglas Bryant served as CEO throughout the Class Period and occupied a

public-facing role for the company’s communications regarding Savanna and

COVID-19 revenues. Id., ¶¶ 4, 37, 344. He oversaw the Executive Steering

Committee for the Savanna project, signed SEC filings, and was directly involved in


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decisions regarding product launch, regulatory submissions, and public guidance.

Id., ¶¶ 37, 43, 205, 357.

      As CFO, Joseph Busky was responsible for financial reporting and revenue

guidance, including the abrupt doubling of endemic COVID-19 revenue projections.

Id., ¶¶ 38, 108. He received reports on sales, inventory, and financial risks and

participated in public statements and earnings calls. Id., ¶¶ 43, 215, 376-378.

      Former CEO Randall Steward, COO Bujarski, CCO and Interim CEO Iskra,

and SVP of Molecular Diagnostics Ranalli each played key roles in the development,

marketing, and oversight of Savanna and were recipients of internal reports

detailing product issues and sales trends. Id., ¶¶ 39-43, 360-362. For these and the

other C-suite executives, compensation was allegedly tied to Savanna’s launch. Id.,

¶¶ 136 (“Kroll, Defendant Steward, and Defendant Bujarski had large incentives in

their employment contracts that were tied to Savanna RVP4 advances.”), 381 (C-

suite bonuses were tied to achieving “certain Savanna launch targets,” and former

employees confirm that compensation structure motivated the unrealistic and

intense pressure surrounding Savanna.).

G.    Procedural History

      On April 12, 2024, Bristol County Retirement System filed a class action

complaint against QuidelOrtho and three of its executives on behalf of all investors

who purchased or otherwise acquired QuidelOrtho common stock during the Class

Period (“the Securities Action”). ECF No. 1. About two weeks later, individual

QuidelOrtho shareholder Matthew Whitfield separately filed a shareholder


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derivative action on behalf of QuidelOrtho against several members of the

Company’s board of directors and the QuidelOrtho executives named as Defendants

in the Securities Action. In Re Quidelortho Corporation Derivative Litigation, No.

24-CV-03176 (S.D.N.Y.). The following day, Whitfield filed a Statement of

Relatedness to the Securities Action. In Re Quidelortho Corporation Derivative

Litigation, No. 24-CV-03176, ECF No. 3 (S.D.N.Y. April 26, 2024). Two months

later, individual QuidelOrtho shareholder Steven Pinkney also separately filed a

shareholder derivative action and a Statement of Relatedness to the Securities

Action. In Re Quidelortho Corporation Derivative Litigation, No. 24-CV-04753, ECF

Nos. 1, 4 (S.D.N.Y. June 21, 2024). The Court accepted the shareholder derivative

actions filed by Whitfield and Pinkney (collectively, the “Derivative Actions”) as

cases related to the Securities Action.

      On December 16, 2024, following oral argument on competing motions for

appointment of Lead Plaintiff and Lead Counsel, the Court appointed the

Teamsters Funds as Lead Plaintiff and Labaton Keller Sucharow LLP as Lead

Counsel. See generally ECF No. 34. The Court also consolidated the two Derivative

Actions, declining to consolidate them with the Securities Action, and stayed the

Derivative Actions for purposes of judicial economy. Id. at 10-11. The case was

subsequently reassigned to the undersigned. ECF No. 41. On February 7, 2025,

the Teamsters Funds filed the Amended Complaint. ECF No. 42. Defendants

moved to dismiss on April 4, 2025, ECF No. 47, and the parties filed their cross-

motions to strike in June and July 2025, ECF Nos. 51, 57.


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                                LEGAL STANDARDS

A.    Pleading Requirements

      On a Rule 12(b)(6) motion to dismiss, the Court must “accept[] all factual

allegations in the complaint [as true] and draw[] all reasonable inferences in the

plaintiff’s favor.” ATSI Commc’ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87, 98 (2d Cir.

2007). “To survive a motion to dismiss, a complaint must plead ‘enough facts to

state a claim to relief that is plausible on its face.’” Ruotolo v. City of New York, 514

F.3d 184, 188 (2d Cir. 2008) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570

(2007)); see ATSI Commc’ns, 493 F.3d at 98 & n. 2 (applying the Twombly standard

in the context of a securities fraud claim).

      Securities fraud claims brought under Section 10(b) and Rule 10b-5 are

subject to additional, heightened pleading requirements. Federal Rule of Civil

Procedure 9(b) requires that “the circumstances constituting fraud . . . shall be

stated with particularity.” Novak v. Kasaks, 216 F.3d 300, 306 (2d Cir.

2000) (citation omitted). Under Rule 9(b), a complaint must “(1) specify the

statements that the plaintiff contends were fraudulent, (2) identify the speaker, (3)

state where and when the statements were made, and (4) explain why the

statements were fraudulent.” Id. (internal quotation marks omitted). The Private

Securities Litigation Reform Act of 1995 (“PSLRA”) further requires a complaint to

(i) “specify each statement alleged to have been misleading, the reason or reasons

why the statement is misleading, and, if an allegation regarding the statement or

omission is made on information and belief, . . . state with particularity all facts on


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which that belief is formed,” ATSI Commc’ns, 493 F.3d at 99 (quoting 15 U.S.C.

§ 78u 4(b)(1)), as well as (ii) “state with particularity facts giving rise to a strong

inference that the defendant acted with the required state of mind,” id. (quoting 15

U.S.C. § 78u-4(b)(2)). In sum, the heightened pleading standards of Rule 9(b) and

the PSLRA require that plaintiffs “do more than say that the statements . . . were

false and misleading; they must demonstrate with specificity why and how that is

so.” Rombach v. Chang, 355 F.3d 164, 174 (2d Cir. 2004).

B.     Section 10(b), Rule 10b-5, and Section 20(a) Liability

       Under Section 10(b) of the Exchange Act, it is unlawful to “use or employ, in

connection with the purchase or sale of any security . . . any manipulative or deceptive

device or contrivance in contravention of such rules and regulations as the

Commission may prescribe.” 15 U.S.C. § 78j(b). SEC Rule 10b-5, promulgated under

section 10(b), further dictates:

       It shall be unlawful for any person . . . (a) [t]o employ any device,
       scheme, or artifice to defraud, (b) [t]o make any untrue statement of a
       material fact or to omit to state a material fact . . . or (c) to engage in
       any act, practice, or course of business which operates or would operate
       as a fraud or deceit upon any person, in connection with the purchase
       or sale of any security.

17 C.F.R. § 240.10b-5.

       Under Section 20(a) of the Exchange Act, “[e]very person who, directly or

indirectly, controls any person liable under any provision of this chapter . . . shall

also be liable jointly and severally with and to the same extent as such controlled

person,” unless the purported control person can demonstrate that he “acted in good

faith and did not directly or indirectly induce the act or acts constituting the


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violation or cause of action.” 15 U.S.C. § 78t(a).

C.    Motion to Strike

      Federal Rule of Civil Procedure 12(f) states that “[t]he court may strike from

a pleading an insufficient defense or any redundant, immaterial, impertinent, or

scandalous matter.” Fed. R. Civ. P. 12(f) (emphasis added). This rule “excludes

motions from the definition of pleadings, and courts in this district have held that

Rule 12(f) does not authorize this court to strike documents other than pleadings.”

In re AppHarvest Sec. Litig., 684 F. Supp. 3d 201, 238 (S.D.N.Y. 2023) (cleaned up).

                                    DISCUSSION

      In the 191-page Amended Complaint, Lead Plaintiff imputes to Defendants

four types of misrepresentations, comprising 104 statements in total. Am. Compl.,

¶¶ 321(a)-(s), 327(a)-(w), 337(a)-(e), 339(a)-(bb), 344(a)-(v), 350, 351.3 Defendants

respond that many of the alleged misrepresentations are protected by the PSLRA’s

statutory safe harbor, are inactionable puffery, or lack falsity. See, e.g., ECF No. 48

(“MTD Mem.”) at 2.

      To succeed on a Section 10(b) claim in the Second Circuit, “a plaintiff must

prove (1) a material misrepresentation or omission by the defendant; (2) scienter;

(3) a connection between the misrepresentation or omission and the purchase or


3In appendices to their respective briefs, the parties have each indexed the
statements alleged in the Amended Complaint, see ECF Nos. 48-1, 50-1, which the
Court has reproduced in modified form as an appendix to this Opinion. The Court
refers to alleged misstatements with citations both to the Amended Complaint and
by “Statement number,” as identified in its appendix. As noted supra, see note 2,
reproduced statements are bolded and italicized, per the Amended Complaint, to
distinguish alleged misstatements from unchallenged text.


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sale of a security; (4) reliance upon the misrepresentation or omission; (5) economic

loss; and (6) loss causation.” Gimpel v. Hain Celestial Grp., Inc., 156 F.4th 121, 136

(2d Cir. 2025). Defendants challenge only the first two of these prongs. See

generally MTD Mem. The Court begins with the parties’ cross-motions to strike, as

these motions address what materials the Court may properly consider in ruling on

the Motion to Dismiss.

A.        Motions to Strike

          Defendants move to strike Appendix A to Lead Plaintiff’s memorandum of

law in opposition to Defendants’ motion to dismiss, ECF No. 50-1 (the “Appendix”),

and to partially strike the Glossary of Defined Terms (“Glossary”) included in that

same memorandum, ECF No. 50 (“Opp’n”). Lead Plaintiff moves to strike the

Declaration of Colin B. Davis and the forty-six exhibits attached thereto, ECF No.

49 (“Davis Declaration”), as well as “Appendix A” attached to Defendants’

memorandum in support of their motion to dismiss, ECF No. 48-1, pursuant to

Federal Rules of Civil Procedure 12(d) and 12(f). ECF No. 52 (“Pl. Mem. Str.”) at 1.

     1.      Lead Plaintiff’s Motion to Strike

          The Teamsters Funds argue that (1) Defendants’ request for the Court to

take judicial notice of the forty-six exhibits attached to the Davis Declaration and

incorporate them by reference into the Amended Complaint is insufficient because it

is argued in a footnote; (2) eight of Defendants’ exhibits do not satisfy the standard

for judicial notice; (3) Defendants improperly attempt to cast doubt on the content of

investor calls; (4) Defendants improperly attempt to utilize several exhibits as


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“factual rebuttal”; and (5) Appendix A should be stricken because it relies on these

exhibits. Id. at 1-2. Defendants respond that the Teamsters’ Funds’ motion is

procedurally improper, that Defendants’ exhibits meet the legal standards for either

judicial notice or incorporation by reference, and that Appendix A may be properly

considered by the Court. ECF No. 62 at 1-2. Because Lead Plaintiff’s motion seeks

to strike materials other than pleadings, its motion is procedurally improper. The

Court thus turns to whether these materials may be considered in deciding

Defendants’ pending motion to dismiss.

      a.      Documents Incorporated by Reference

      Federal Rule of Civil Procedure 12(d) provides, in relevant part, that courts

may not look to materials extrinsic to the complaint without converting the instant

motion to dismiss to a Rule 56 motion for summary judgment. Fed. R. Civ. P. 12(d).

A court may, however, rely upon documents attached to the complaint as exhibits,

documents which the complaint incorporates by reference, and documents “upon

which [a complaint] . . . relies and which [are] integral to the complaint.” Cloister

E., Inc. v. N.Y. State Liquor Auth., 563 F. Supp. 3d 90, 105 (S.D.N.Y. 2021)

(citations omitted); accord Ark. Public Emps. Ret. Sys. v. Bristol-Myers Squibb, 28

F.4th 343, 357 n.3 (2d Cir. 2022). A document cannot be incorporated by reference

through the Defendants’ motion papers, whether mentioned in a footnote or

otherwise. Rather, the Court must look to whether the Complaint “make[s] a clear,

definite and substantial reference to the documents.” Mosdos Chofetz Chaim, Inc. v.

Vill. of Wesley Hills, 815 F. Supp. 2d 679, 691 (S.D.N.Y. 2011) (cleaned up).


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      Of the forty-six exhibits, it is undisputed that thirty-eight are incorporated by

reference in the Complaint. Pl. Mem. Str. at 11-12. Of those exhibits, Lead

Plaintiff contests the Courts’ consideration of Defendants’ Exhibits 3-4, 7, 9-29, 31-

32, 34, 35, 38-42, and 44 on the basis that “it is improper to assume the truth of an

incorporated document if such assumptions only serve to dispute facts stated in a

well-pleaded complaint.” Id. at 12 (quoting Khoja v. Orexigen Therapeutics, Inc.,

899 F.3d 988, 1003 (9th Cir. 2018)). Certainly, “defendants may not use plaintiffs’

sources as an archive from which to build what amounts to a factual rebuttal.” In re

Int. Rate Swaps Antitrust Litig., 261 F. Supp. 3d 430, 481 (S.D.N.Y. 2017). Yet the

“principle” permitting a Court to consider documents “incorporated by reference” on

a Rule 12(b)(6) motion “has its greatest applicability in cases alleging fraud.” Roth

v. Jennings, 489 F.3d 499, 509 (2d Cir. 2007). Indeed, “when the complaint alleges

that such a document made a particular representation, the court may properly look

at the document to see whether that representation was made.” Id. Accordingly,

the Court will consider these exhibits for this limited purpose.

      Lead Plaintiff similarly does not dispute that the transcripts of investor calls

and conferences provided by Defendants in Exhibits 30, 33, 37, and 43 are

incorporated by reference into the Amended Complaint. See Pl. Mem. Str. at 11-12.

Rather, the dispute is as to which version of the transcripts should be considered.

Lead Plaintiff accuses Defendants of submitting incomplete transcripts and submits

competing versions to the Court. Id.; ECF No. 53, Exs. A-D. Defendants contend

that they obtained the transcripts from Bloomberg Law, a reputable source, and


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questions the authenticity of Lead Plaintiff’s exhibits. ECF No. 62 at 15-16. As the

Court must “accept all factual claims in the complaint as true and draw all

reasonable inferences in the plaintiff’s favor,” Emps.’ Ret. Sys. of Gov’t of the V.I. v.

Blanford, 794 F.3d 297, 307 (2d Cir. 2015) (cleaned up), and “[f]act specific

questions cannot be resolved on the pleadings,” Anderson News, L.L.C. v. Am.

Media, Inc., 680 F.3d 162, 185 (2d Cir. 2012) (cleaned up), the Court looks to Lead

Plaintiff’s submissions for purposes of resolving this motion to dismiss.

      b.     Judicial Notice

      With respect to the remaining eight exhibits, Defendants request that the

Court take judicial notice. ECF No. 61. Federal Rule of Evidence 201(b) provides

that a district court ruling on a motion to dismiss may judicially notice a fact that is

not subject to reasonable dispute because it is “generally known within the trial

court’s territorial jurisdiction” or “can be accurately and readily determined from

sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b).

The Court may take notice on its own and must take judicial notice if “a party

requests it and the court is supplied with the necessary information.” Id. These

documents are “relevant not to prove the truth of their contents but only to

determine what the documents stated.” Kramer v. Time Warner Inc., 937 F.2d 767,

774 (2d Cir. 1991).

      “Under Federal Rule of Evidence 201, a court ‘may take judicial notice on its

own’ of ‘a fact that is not subject to reasonable dispute because it: (1) is generally

known within the trial court’s territorial jurisdiction; or (2) can be accurately and


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readily determined from sources whose accuracy cannot reasonably be questioned.’”

Johnson v. McKay, No. 14-CV-00803 (BKS) (TWD), 2015 WL 1735102, at *4

(N.D.N.Y Apr. 16, 2015) (quoting Fed. R. Evid. 201(b)-(c)). “Still, as it always does,

the Court examines Defendants’ exhibits to determine whether they are properly

considered to resolve this motion to dismiss,” Bazzelle v. Novocure Ltd., No. 23-CV-

05146 (GHW), 2025 WL 843668, at *6 (S.D.N.Y. Mar. 18, 2025), keeping in mind

that “a ruling on a motion for dismissal pursuant to Rule 12(b)(6) is not an occasion

for the court to make findings of fact.” Roth, 489 F.3d at 509.

      The Court determines that Exhibits 1-2, 5-6, 8, 36, and 45-46 are suitable for

judicial notice “only to determine what the documents stated.” Kramer, 937 F.2d at

774. Exhibits 1 and 8 are excerpts of QuidelOrtho’s Annual Reports on Form 10-K

filed with the U.S. Securities and Exchange Commission (the “SEC”); Exhibits 2

and 36 are press coverage of the Savanna launch and QuidelOrtho earnings

respectively; Exhibits 5 and 6 are the transcript and accompanying presentation for

Quidel’s January 12, 2022 presentation at the Bloomberg J.P. Morgan 40th Annual

Healthcare Conference; Exhibit 45 is a transcript of QuidelOrtho’s July 31, 2024

earnings call for the second quarter of 2024; and Exhibit 46 is a chart of the

Company’s share prices over time. This public information “can be accurately and

readily determined from sources whose accuracy cannot reasonably be questioned,”

Fed. R. Evid. 201(b)(2), and is especially important considering Lead Plaintiff’s

invocation of Rule 10b-5 to allege that Defendants’ misstatements or omissions have

altered the “total mix of information” available to investors, Basic, Inc. v. Levinson,


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485 U.S. 224, 232 (1988) (cleaned up). “When a complaint alleges, for example, that

a document filed with the SEC failed to disclose certain facts, it is appropriate for

the court, in considering a Rule 12(b)(6) motion, to examine the document to see

whether or not those facts were disclosed.” Roth, 489 F.3d at 509.

          Accordingly, Lead Plaintiff’s motion is denied.

     2.      Defendants’ Motion to Strike

          In their motion to strike, Defendants argue that Lead Plaintiff attempts to

improperly amend the operative complaint and circumvent the Court-ordered page

limit through its Glossary, which provides definitions of various terms, and

Appendix, which adds two columns of citations from the pleadings to the appendix

created by Defendants. ECF No. 58 at 1. This argument both lacks merit and

improperly attempts to strike documents outside the pleadings.

          Accordingly, Defendants’ motion to strike is denied.

B.        Section 10(b) Claims

          Section 10(b) and Rule 10b-5(b) protect investors from material

misrepresentations in connection with the sale or purchase of securities. “Under

Rule 10b-5(b), it is unlawful to[, in connection with the sale of any security,] (1)

make any untrue statement of a material fact, or (2) omit to state a material fact

necessary in order to make the statements made . . . not misleading.” Gimpel, 156

F.4th at 138 (citing 17 C.F.R. § 240.10b-5(b) (cleaned up)). “These prongs

correspond to two actionable theories under Section 10(b) and Rule 10b-5: (1) a

false statement, i.e., an actual statement that is untrue outright, and (2) a half-


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truth, i.e., a representation that states the truth only so far as it goes, while

omitting critical qualifying information.” Id. (cleaned up). “A false statement . . .

must . . . be false at the time it was made, and the plaintiff must demonstrate with

specificity why the statement is false.” Id.

      A half-truth theory relies on a company’s “duty to be both accurate and

complete.” Caiola v. Citibank, N.A., N.Y., 295 F.3d 312, 331 (2d Cir. 2002). Rule

10b-5 “does not proscribe pure omissions,” only omissions of “material facts

necessary to make the ‘statements made . . . not misleading.’” Macquarie

Infrastructure Corp. v. Moab Partners, L.P., 601 U.S. 257, 264 (2024) (quoting 17

C.F.R. § 240.10b–5(b)). While Section “10(b) and Rule 10b-5 do not create an

affirmative duty to disclose any and all material information,” Matrixx Initiatives,

Inc. v. Siracusano, 563 U.S. 27, 44 (2011), once “a company speaks on an issue or

topic,” it must “tell the whole truth,” Meyer v. Jinkosolar Holdings Co., 761 F.3d

245, 250 (2d Cir. 2014). “Adequate disclosure” is required alongside such

statements to ensure that, “in light of the circumstances under which they were

made, [they are] not misleading.” Id. (cleaned up). Whether a statement is

misleading is an objective inquiry reliant upon its “literal truth” and its “context

and manner of presentation.” Singh v. Cigna Corp., 918 F.3d 57, 63 (2d Cir. 2019).

      A securities fraud plaintiff “must also adequately allege that the

misstatement or half-truth is ‘material,’ meaning that ‘a reasonable investor would

have considered [it] significant in making investment decisions.’” Gimpel, 156 F.4th

at 139 (quoting Caiola, 295 F.3d at 329); accord Matrixx, 563 U.S. at 38 (statement


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materially misleading if there was “substantial likelihood” that it “would have been

viewed by the reasonable investor as having significantly altered the total mix of

information made available.” (cleaned up)).

        At the pleading stage, allegations from confidential witnesses are taken as

true if they “are described in the complaint with sufficient particularity to support

the probability that a person in the position occupied by the source would possess

the information alleged.” Emps.’ Ret. Sys. of Gov’t of the V.I., 794 F.3d at 305

(quoting Novak, 216 F.3d at 314); see also City of Warren Police & Fire Ret. Sys. v.

World Wrestling Ent. Inc., 477 F. Supp. 3d 123, 132 (S.D.N.Y. 2020) (“This liberal

standard make[s] sense; the heightened demands of the PSLRA will often require

plaintiffs to rely on the testimony of confidential sources, even where those sources

offer indirect knowledge, that is, information and belief that is hearsay but

plausible.”).

   1.      Alleged Misrepresentations

        Lead Plaintiff alleges that Defendants Bryant, Busky, Bujarski, Iskra, and

Ranalli made materially false and misleading statements and omissions concerning:

(i) the status of QuidelOrtho’s European launch of Savanna RVP4; (ii) Savanna

RVP4’s readiness for a U.S. launch and FDA approval; (iii) the Company’s ability to

manufacture Savanna RVP4 at the necessary scale to achieve over $75 million in

revenue synergies and $300 million in overall revenue; and (iv) QuidelOrtho’s

endemic COVID-19 revenue. The Court addresses each category of alleged

misrepresentations, and defenses raised against statements therein, in turn.


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          a.     Challenged Statements on Savanna RVP4’s European
                 Launch

      Lead Plaintiff contends that Defendants Bryant, Ranalli, Busky, and

QuidelOrtho altogether made 19 misstatements regarding Savanna RVP4’s

European launch during the Class Period. Am. Compl., ¶¶ 321(a)-(s).

                 i.      Falsity

      Defendants assert that statements concerning Savanna RVP4’s European

launch were not false or misleading because “the number of defective and invalid

RVP4 tests, defective Savanna instruments[,] and related string of escalating

customer complaints,” id., ¶ 322—all omitted from the total mix of information

available to investors—did not contradict Defendants’ statements about positive

feedback and high customer demand in Europe, MTD Mem. at 17.

      “The test for whether a statement is materially misleading under Section

10(b) . . . is whether the defendants’ representations, taken together and in context,

would have misled a reasonable investor.” City of Hialeah Emps.’ Ret. Sys. v.

Peloton Interactive, Inc., 153 F.4th 288, 295 (2d Cir. 2025) (quoting Rombach v.

Chang, 355 F.3d 164, 172 n.7 (2d Cir. 2004)) (internal quotation marks omitted). “A

statement or omission is material if there is a substantial likelihood that a

reasonable shareholder would consider it important in deciding how to act.” IBEW

Loc. Union No. 58 Pension Tr.t Fund & Annuity Fund v. Royal Bank of Scotland

Grp., PLC, 783 F. 3d 383, 389 (2d Cir. 2015) (internal quotation marks omitted); see

also City of Hialeah, 153 F.4th at 295 (“Similarly, for an alleged statement to be

‘material’ under Section 10(b), it must be sufficiently specific for an investor to


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reasonably rely on that statement as a guarantee of some concrete fact or outcome.”

(cleaned up)).

      Applying those standards here, Lead Plaintiff has plausibly alleged material

misrepresentations associated with Savanna SVP4’s European launch. Internal

reports indicated that the launch was plagued by customer complaints and product

returns. Am. Compl., ¶¶ 179-82, 222. From the beginning of Savanna’s EU launch

in late 2021, the Company’s Scientific Marketing Manager, Europe reported to

Company leadership that “the Savanna RVP4 tests were failing in Europe,” and an

employee who felt he had the “best pulse” on Savanna RVP4’s performance in

Europe reported that 60-80% of customer feedback was negative. Id., ¶¶ 171, 185-

187. A quarterly report in 2023 showed even more complaints (85) than units in

distribution (80). Id., ¶ 188. These figures stand in stark contrast to the picture

Defendants paint through cited caselaw. See, e.g., Pearlstein v. BlackBerry Ltd.,

93 F. Supp. 3d 233, 238 & 240-41 (S.D.N.Y. 2015) (statements that “the launch of

BlackBerry . . . marked the beginning of the organization’s transition to becoming a

leading mobile computing organization” and “[c]ustomers love the device” were not

false or misleading “[e]ven though . . . BlackBerry 10 devices were not selling well”

because that fact did not “contradict generally optimistic sentiments”). A market

launch so replete with errors and customer discontent, see, e.g., Am. Compl., ¶ 362

(“FE-7 described how, in the 20 years he has been in this line of work, he “didn’t

remember any market launch that was so full of issues”), can hardly be described as

yielding “generally optimistic sentiments.”


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      Accordingly, some, though not all, of the challenged statements would have

materially misled investors about Savanna RVP4’s promise vis à vis its European

launch. Statement 17 provides an illustrative example. In August 2023 during a

Q2 2023 Earnings Call,4 Defendant Bryant remarked with respect to the decline of

QuidelOrtho’s molecular diagnostics business: “Notably, this was partially

offset by Savanna, which continued to perform well in the EU, with a modest

improvement in sales year-over-year. Given the product’s ease-of-use and

industry-leading speed, we are seeing a lot of customer interest and have

expanded our reach to more customers across Europe.” Am. Compl., ¶ 321(q).

The use of the word “notably” during the Earnings Call indicates Bryant’s cue to

investors that Savanna’s “modest improvement” in sales year-over-year in Europe

was material enough to “partially offset” what the Company ultimately reported to

be a 67% decrease in year-over-year molecular diagnostics revenue—approximately

$65 million, or an average of about $16.25 million per quarter. Id., ¶ 295.5 Yet the

Company generated only $2.56 million from Savanna RVP4 sales in Europe in all of


4 ECF No. 50-1 corrects the Amended Complaint’s attribution of this statement to a
Q3 2023 Earnings Call.
5 QuidelOrtho Corp., Annual Report (Form 10-K), at 55 (Feb. 28, 2024),

https://perma.cc/6NFF-A7LW; Am. Compl., ¶ 295. See Tang Cap. Partners, LP. v.
BRC Inc., 661 F. Supp. 3d 48, 59 (S.D.N.Y. 2023) (“[T]he Second Circuit has
consistently held that in the securities context, courts may consider public
disclosure documents required by law to be, and that have been, filed with the
SEC.” (internal quotation marks omitted) (citing cases)); ATSI Commc’ns, 493 F.3d
at 98 (“[W]e may consider any written instrument attached to the complaint,
statements or documents incorporated into the complaint by reference, legally
required public disclosure documents filed with the SEC, and documents possessed
by or known to the plaintiff and upon which it relied in bringing the suit”).


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2023, or an average of about $640,000 per quarter. Id., ¶ 333. While the pleadings

do not provide an exact per-quarter distribution of these losses and gains, they

provide enough to suggest that Bryant’s characterization of Savanna’s EU revenues

in August 2023 as a “notabl[e] . . . offset” likely materially misled investors. Id.,

¶ 321(q).

      Other alleged misstatements are not pleaded with this level of specificity.

Lead Plaintiff provides no basis of falsity for Statement 9, wherein Defendant

Bryant asserted during a Q3 2022 Earnings Call in November of that year, “[W]e

are shifting boxes that we had intended to ship early in the United States to

Europe where, frankly, the folks there have been asking for more boxes than

we are shipping. So it’s just that straightforward.” Am. Compl., ¶ 321(i).

Although the Amended Complaint alleges facts sufficient to call the European

demand for RVP4 into question, id., ¶ 170, the particulars of QuidelOrtho’s shipping

practices are not pleaded.

      Further, Lead Plaintiff does not allege facts sufficient to explain why

Defendant Ranalli’s Statement 12 is misleading. Lead Plaintiff challenges

Defendant Ranalli’s assertion during a 2022 Investor Day call in December 2022

regarding the Company’s “installed base target,” the “pull-through in those

installed bases,” and a conclusion based on data from the EU launch that the

Company would achieve “fewer boxes placed, but those boxes are running at a

higher rate than our original estimation.” Id., ¶ 321(l). Although Lead

Plaintiff does plead with particularity why certain financial projections for Savanna


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RVP4 were misleading, infra Discussion § B(1)(b)(iv)(1), the Amended Complaint

does not allege facts sufficient to challenge the Company’s amendments to its

original run rate.

                  ii.      Puffery

         Defendants challenge 17 statements in this category as inactionable puffery

or corporate optimism, “vague[] and enthusiastic[]” statements that are “too general

to cause a reasonable investor to rely upon them.” 6 Okla. Firefighters Pension &

Ret. Sys. v. Xerox Corp., 300 F. Supp. 3d 551, 569-70 (S.D.N.Y. 2018).

         “Generic, indefinite statements of corporate optimism typically are not

actionable” because “reasonable investors [do not] place substantial reliance on

generalizations regarding a company’s health or the strength of a company’s

product.” Abramson v. Newlink Genetics Corp., 965 F.3d 165, 173 (2d Cir. 2020);

ECA, Loc. 134 IBEW Joint Pension Tr. of Chicago v. JP Morgan Chase Co., 553 F.3d

187, 206 (2d Cir. 2009) (statements “too general to cause a reasonable investor to

rely upon them” are inactionable puffery). Such “puffery” is thus “actionable only

when the speaker knew that the contrary was true.” Abramson, 965 F.3d at 174

(cleaned up).

         “Whether a representation is ‘mere puffery’ depends, in part, on the context

in which it is made.” In re Petrobras Sec. Litig., 116 F. Supp. 3d 368, 381 (S.D.N.Y.

2015). Moreover, where the context makes it such that “a reasonable investor could

rely on them as reflective of the true state of affairs at the Company,” puffery


6   These include Statements 2-11 and 13-19. Am. Compl., ¶ 321(b)-(k), (m)-(s).


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defenses fail. Id. at 381; accord In re Turquoise Hill Res. Ltd. Sec. Litig., 625 F.

Supp. 3d 164, 222 (S.D.N.Y. 2022). “The key distinction between [mere puffery] and

potentially actionable statements is that these [inactionable] statements were non-

verifiable” at the time they were made. Okla. Firefighters, 300 F. Supp. 3d at 570.

Corporate statements that things are “moving forward well” or “going well,” or that

a company is “well positioned, or that its operations are “successful” are “classically

non-actionable unless the statements addressed concrete and measurable areas of

the defendant company’s performance.” Id. (cleaned up).

      Half of Statement 6 and all of Statements 7, 13, and 15 fall within this

category. On the 2022 Q2 Earnings Call, Defendant Bryant announced, “Our

limited European launch of Savanna with RVP4 continues to go well with

some early wins. As manufacturing capacity ramps, we plan a full

European launch in Q4, followed by 2023 menu expansions.” Am. Compl.,

¶ 321(f). The latter half of this statement—specifically linking a full European

launch to increasing manufacturing capacity and projecting 2023 menu

expansions—is neither “generic” nor “indefinite.” Abramson,, 965 F.3d at 173 (2d

Cir. 2020). The first half, however, touting the launch generally as “go[ing] well”

and having “early wins,” is entirely “non-verifiable.” Okla. Firefighters, 300 F.

Supp. 3d at 570; Am. Compl., ¶ 321(f). The same is true of Statement 7,

attributable to Bryant at the Morgan Stanley Global Healthcare Conference in

September 2022: “And we’ve been pretty pleased with what we’ve done in

Europe with the Savanna launch early on and I would say it portends well


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for the rest of the globe.” Am. Compl., ¶ 321(g). Phrases like “pretty pleased”

applied in generic terms to what the Company had “done in Europe” are “too

general to cause a reasonable investor to rely upon them.” ECA, 553 F.3d at 206.

Statement 15 can be dismissed as inactionable puffery for the same reason.7

Statement 13—by Bryant at the 41st Annual J.P. Morgan Healthcare Conference in

February 2023—is a bit more concrete, identifying “demand” in Europe.8 Yet

Bryant in no way quantifies or even characterizes the demand he identifies here,

nor does he attach his optimism to any particular deliverable. Accordingly, these

statements can be dismissed as inactionable puffery.

      Statement 5 offers a telling counterexample to those Defendants successfully

challenge on these grounds. At the June 2022 William Blair Annual Growth Stock

Conference, Defendant Bryant declared: “[W]e just launched Savanna in

Europe in a couple of different countries [sic] have done super well. We

took pretty significant share from [indiscernible] recently in Italy. And I

think right now the demand creation is not the issue.” Not only does the

phrase “super well” (in contrast to Statement 7’s “pretty well”) imply to reasonable

investors that the EU launch was free of catastrophes, but this statement also

explicitly ties Savanna’s success to European demand and denies the product’s


7 Am. Compl., ¶ 321(o) (Defendant Bryant during the 2022 Q4 Earnings Call in
February 2023: “And I think it would be fair to say that we’ve been
reasonably successful in a limited launch in Europe with Savanna too.”)
8 Am. Compl., ¶ 321(m) (“We’ve demonstrated in Europe and elsewhere that

there is demand. We see pretty strong demand expressed by US customers as
well for this product, and we have a wait list. So, I think this is going to go well .
. . If I’m wrong, you won’t see me here next year. I’ll be hiding.”)


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weakness in that category (“not the issue”), narrowing and concretizing the scope of

Bryant’s commentary. Statements 1, 3, 14, and 16 likewise “address[] concrete and

measurable areas of the defendant [C]ompany’s performance” and thus cannot be

dismissed as inactionable puffery. 9 Okla. Firefighters, 300 F. Supp. 3d at 570.

               iii.      Inactionable Opinion

      Defendants challenge seven statements in this category as inactionable

opinions.10 “A fact is ‘a thing done or existing or an actual happening,’ while an

opinion is ‘a belief, a view, or a sentiment which the mind forms of persons or


9 Am. Compl., ¶ 321(a) (“Based on customer reviews in Europe, we believe
Savanna will be a major growth driver, both in the U.S. and globally, for
years to come.”); id., ¶ 321(c) (“That’s Savanna, that’s beautiful, performing
very nicely in Europe right now. We’re hearing really nice feedback. I think
it’s the right design for the market at this time.”); id., ¶ 321 (n) (“Savanna
sales in Europe are expected to drive strong growth within our Molecular
Diagnostics business, which, along with the expected ramp in the US
volumes after receipt of regulatory clearance, are expected to drive
meaningful revenue in the back half of the year.”); id., ¶ 321(p) (“Savanna
sales in Europe are expected to ramp as we move through the year, which
along with expected U.S. volumes after anticipated receipt of regulatory
clearance are expected to drive meaningful revenue in the back half of the
year.”).
10 These include Statements 1 (“Based on customer reviews in Europe, we

believe Savanna will be a major growth driver, both in the U.S. and
globally, for years to come.”), 3 (“That’s Savanna, that’s beautiful, performing
very nicely in Europe right now. We’re hearing really nice feedback. I think
it’s the right design for the market at this time.”), 5 (“[W]e just launched
Savanna in Europe in a couple of different countries [sic] have done super
well. We took pretty significant share from [indiscernible] recently in Italy.
And I think right now the demand creation is not the issue.”), and 16
(“Savanna sales in Europe are expected to ramp as we move through the
year, which along with expected U.S. volumes after anticipated receipt of
regulatory clearance are expected to drive meaningful revenue in the back
half of the year.”). MTD Mem. at 11, n. 3; Am. Compl., ¶¶ 321(a), (c), (e), (p). The
Court does not include in this subsection any otherwise applicable Statements that
have already been addressed on other grounds.


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things.’” New England Carpenters Guaranteed Annuity & Pension Funds v.

DeCarlo, 122 F.4th 28, 40 (2d Cir. 2024) (quoting Omnicare, Inc. v. Laborers Dist.

Council Constr. Indus. Pension Fund, 575 U.S. 175, 183 (2015)), cert. denied sub

nom. BDO USA, LLP v. New England Carpenters Guaranteed Annuity & Pension

Funds, 146 S. Ct. 261 (2025). Statements 1, 3, 5, 7, 13, 15, and 16 all bear

hallmarks of opinions, such as “I think,” “I would say,” “[w]e believe,” or convey a

subjective assessment through phrases such as “expected to.” 11

      Defendants contend these opinion statements are protected from liability

because they convey “inherently subjective . . . assessment[s],” ECF No. 59 (“Reply”)

at 4-5 (quoting In re Philip Morris Int’l Inc. Sec. Litig., 89 F.4th 408, 418 (2d Cir.

2023)), that are “not necessarily misleading when an issuer knows, but fails to

disclose, some fact cutting the other way,” id. at 5 (quoting Omnicare, 575 U.S. at

189). “[A] sincere statement of pure opinion is not an untrue statement of material

fact” giving rise to liability under the securities laws, even if “an investor can

ultimately prove the belief wrong.” Omnicare, 575 U.S. at 186 (cleaned up). This is

because “[r]easonable investors understand that opinions sometimes rest on a

weighing of competing facts; indeed, the presence of such facts is one reason why an

issuer may frame a statement as an opinion, thus conveying uncertainty.” Id. at

189-90.

      “But opinions lead double lives.” New England Carpenters, 122 F.4th at 41.


11Am. Compl., ¶¶ 321(a), (c), (e), (g), and (p). Statement 3 is mixed. Only the final
sentence in that statement is an opinion.


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This is because “an opinion may implicitly convey ‘facts about how the speaker has

formed the opinion.’” Id. (quoting Omnicare, 122 F.4th at 188). “[I]f the real facts

are otherwise, but not provided, the opinion statement will mislead” a reasonable

investor. Omnicare, 575 U.S. at 188. In other words, an “opinion may be false or

misleading if the embedded fact is not one as to which reasonable minds can differ.”

New England Carpenters, 122 F.4th at 42. Accordingly, “whether an omission

makes an expression of opinion misleading always depends on context.” Omnicare,

575 U.S. at 190.

      All of the opinions at issue convey facts about which reasonable minds could

not differ. Take, for instance, Defendant Bryant’s March 2022 statement at the

Raymond James Annual Institutional Investors Conference that Savanna was

“performing very nicely in Europe right now. We’re hearing really nice

feedback. I think it’s the right design for the market at this time.” Am.

Compl., ¶ 321(c). Taking the Amended Complaint’s allegations as true, the facts

embedded in this opinion—that Savanna was broadly well received in Europe and

not plagued with critical design flaws—are not ones about which reasonable minds

could differ. Savanna RVP4’s test assay was failing “from the very beginning” of the

EU launch; customers were “irate”; and early complaints reflected the fact that one

in four tests had to be replaced, devices overheated, and cartridges produced a high

level of invalid test results. Id., ¶¶ 170-177. Demand for the product in this market

was also limited. Id., ¶ 170. Accordingly, the challenged opinion statements are

actionable.


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                iv.       PSLRA Safe Harbor

      The PSLRA exempts certain statements from liability if they are “forward

looking” and meet one of the two prongs of the PSLRA’s safe harbor analysis. 15

U.S.C. § 78u-4; see also Slayton, 604 F.3d at 762 (discussing the “prongs” of

analysis under the PSLRA). The first prong is satisfied, and the speaker is thereby

exempt from liability for the statement, if the statement is “accompanied by

meaningful cautionary statements.” 15 U.S.C. § 78u–5(c)(1). The second prong is

satisfied if “the plaintiff fails to prove that the forward-looking statement . . . was

made with actual knowledge by that person that the statement was false or

misleading.” Id.

      As a threshold matter, courts determine whether a statement is “forward

looking” before inquiring into the PSLRA’s protections. See Slayton, 604 F.3d at

766-67. A “forward-looking statement” is one that contains “a projection of

revenues, income . . . , [or] earnings,” “a statement of the plans and objectives of

management for future operations,” or “a statement of future economic

performance.” 15 U.S.C. § 78u-5(i)(1). “A statement may contain some elements

that look forward and others that do not,” and “forward-looking elements” may be

“severable” from “non-forward-looking” elements.” In re Vivendi Universal, S.A.

Sec. Litig., 765 F. Supp. 2d 512, 569 (S.D.N.Y. 2016) (cleaned up) aff’d, 838 F.3d 223

(2d. Cir, 2016); see also Makor Issues & Rights, Ltd. v. Tellabs Inc., 513 F.3d 702,

705 (7th Cir. 2008) (“[A] mixed present/future statement is not entitled to the safe

harbor with respect to the part of the statement that refers to the present.”).


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      For a statement to qualify for the protections of the PSLRA under this first

prong, “courts must first ‘identify the allegedly undisclosed risk’ and then ‘read the

allegedly fraudulent materials—including the cautionary language—to determine if

a reasonable investor could have been misled into thinking that the risk that

materialized and resulted in his loss did not actually exist.’” zCap Equity Fund

LLC v. LuxUrban Hotels Inc., 792 F. Supp. 3d 407, 432 (S.D.N.Y. 2025) (quoting

Halperin v. eBanker USA.com, Inc., 295 F.3d 352, 359 (2d Cir. 2002)). A plaintiff

may establish that statements are not cautionary if language “did not expressly

warn of or did not directly relate to the risk that brought about plaintiffs’

loss.” Halperin, 295 F.3d at 359. “Vague” or “mere boilerplate” language does not

suffice. Slayton, 604 F.3d at 772.

      While several of Defendants’ misrepresentations regarding the European

launch include forward-looking elements,12 these statements were not accompanied

by meaningful cautionary language. Defendants attempt to invoke safe harbor

protection by pointing the Court to warnings “[d]uring earnings calls and at

investor conferences . . . that [the Company’s] forward-looking statements were

subject to the risk factors identified in the Company’s SEC filings,” which in turn

outlined that “there is no assurance . . . our efforts to develop new technologies,

products or markets will be successful . . . [or] commercially viable.” MTD Mem. at

13-14. Yet such cautionary language does nothing to mitigate Defendant Bryant’s


12 These include Statements 1, 6, 10, 13, 14, 16, and 19. Am. Compl., ¶ 321(a), (f),
(j), (m)-(n), (p), (s). The Court does not address statements already dismissed.


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representation, for instance, that “[b]ased on customer reviews in Europe, we

believe Savanna will be a major growth driver, both in the U.S. and

globally, for years to come.” Am. Compl., ¶ 321(a). This statement, like the other

forward-looking statements about the European launch, was premised not upon

predictions concerning disclosed risk factors but upon false summaries of already-

collected customer feedback on Savanna RVP4’s performance in Europe. These

statements thus do not fall within the scope of the first prong of the safe harbor

provision. See Facebook, 986 F. Supp. 2d at 515 (cautionary language does not

“insulate from liability the failure to disclose that the risk ha[d] transpired”); accord

Rombach v. Chang, 355 F.3d 164, 173 (2d Cir. 2004).

      Lead Plaintiff has also plausibly alleged that Defendants had actual

knowledge of the product’s lackluster reception among the European market, thus

defeating Defendants’ attempt to rely on the second prong of the safe harbor.

According to the Amended Complaint, senior executives were regularly informed

about the negative feedback and technical problems. The rampant issues with the

Savanna European launch were documented and reported up to the C-suite and

Board of Directors through regular meetings, PowerPoint presentations, and

internal complaint systems. Id., ¶¶ 184-185. In this sense, Lead Plaintiff has

“ple[ade]d far more than fraud by hindsight.” In re Glob. Crossing, Ltd. Sec. Litig.,

322 F. Supp. 2d 319, 338 (S.D.N.Y. 2004). Accordingly, these statements do not

receive safe harbor protection.


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          b.     Challenged Statements on Savanna RVP4’s Readiness for a
                 U.S. Launch and FDA Approval

      Lead Plaintiff contends that Defendants QuidelOrtho, Bryant, Busky, Iskra,

Bujarski, and Ranalli altogether made 29 misstatements regarding Savanna

RVP4’s development progress toward FDA approval, satisfaction of FDA threshold

requirements, and readiness for a U.S. launch during the Class Period. Am.

Compl., ¶¶ 327(a)-(w), 337(a)-(e).

                 i.      Falsity

      Lead Plaintiff has plausibly alleged material misrepresentations associated

with Savanna RVP’s readiness for a U.S. launch and FDA approval. Id., ¶¶ 191-

229, 328-36. For instance, several accounts from former employees regarding

Savanna RVP4’s manufacturing yields and sensitivity levels throughout the Class

Period squarely contradict Defendant Bryant’s statement on the Q1 2023 Earnings

Call in May 2023 that “Savanna meets the criteria that the FDA are looking

for. . . I have no reason to believe that the products that we have submitted

will not be.” 13 Id., ¶ 327(k) (Statement 30); see, e.g., id., ¶¶ 193 (“FE-2 stated that

. . . engineering issues with the RVP4 test were not fixed when it went on sale in


13
  Defendants dispute the attribution of this statement to Defendant Bryant, instead
attributing it to Defendant Busky. ECF No. 48-1 at 10 n.2. Lead Plaintiff
maintains that Bryant made the statement, see ECF No. 50-1 at 15 n.4, providing a
transcript in support of this assertion, ECF No. 53-1. The Court credits Lead
Plaintiff’s allegation at this stage. See, e.g., Emps’ Ret. Sys. of Gov’t of the V.I. v.
Blanford, 794 F.3d 297, 307 (2d Cir. 2015) (on motion to dismiss, Court must
“accept all factual claims in the complaint as true and draw all reasonable
inferences in the plaintiff’s favor”) (citation omitted); Anderson News, L.L.C.,680
F.3d at 185 (“Fact specific questions cannot be resolved on the pleadings.” (cleaned
up)).


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Europe in late 2021, . . . not fixed when it was sent to the FDA for approval in the

second quarter of 2023, and . . . not fixed when he left the Company in September

2023.”), 194 (“FE-10 explained how, in early 2022, it became ‘a reality’ for the

Company that the manufacturing yields for RVP4 test were too low to receive FDA

clearance.”); 199 (“the FDA laid out a test plan for the approval of Savanna, which

required that the RVP4 needed to meet a certain functional level of approximately

95% or higher for detectability and accuracy,” but “FE-1 advised that Savanna could

not meet that level of accuracy either directly or through pooled samples”), 200

(“FE-1’s understanding was that the Company knew that it was not meeting the

FDA’s requirements when it submitted its 510(k) application for clearance to sell

Savanna RVP4 in the United States.”), 206 (“FE-4 noted that QuidelOrtho ‘pushed’

for FDA clearance even though employees who worked directly or indirectly with

the Savanna RVP4 test knew that the test had ‘glaring issues.’”). The Second

Circuit has expressly found analogous statements misleading to investors.

Abramson, 965 F.3d at 178 (“Both because of its posture as a response to a specific

question and its categorical nature, . . . a jury could find that, by saying that [the

corporate defendant] did not have ‘any reason’ to believe” the negative outcome at

issue, the speaker, who was company president and chief medical officer, “implied

that there were no competing facts” on this topic.).

      Statement 35 is also illustrative on this point. At the Evercore ISI Health

CONX Conference in November 2023, Defendant Bryant was asked, “what’s

happening with Savanna? It looks like there was some timing pushout.” Am.


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Compl., ¶ 327(p). Beginning his statement, “Let’s be completely open,” Defendant

Bryant elaborated that “the FDA’s concern wasn’t the performance of the

product. It was they want to see how the instrument and cartridge performs

with respiratory season samples.” Id. 14 This statement is a classic “half-truth”

under Rule 10b-5(b). See Gimpel, 156 F.4th at 138-39. Once “a company speaks on

an issue or topic,” it must “tell the whole truth.” Meyer, 761 F.3d at 250.

Particularly given his representation of “complete[] open[ness],” Defendant Bryant’s

omissions here are striking and material. By specifying that the FDA’s concern

with Savanna RVP4 wasn’t the “performance of the product” but rather the

“perform[ance]” of the “instrument and cartridge” (which some might indeed classify

as the “product”) with “respiratory season samples,” this statement implied that the

product’s FDA clearance hurdle was a routine regulatory check for seasonal

incongruency rather than the reality: that RVP4 “never worked properly.” Am.

Compl., ¶ 192. Certainly, disclosure of the fact that the “Savanna RVP4 test ‘never

came close’” to the 95% sensitivity level required for FDA approval, id., ¶ 199, would

have been “substantial[ly] likel[y] . . . [to] have been viewed by the reasonable

investor as having significantly altered the ‘total mix’ of information made

available” about the Company’s FDA submission timeline, Matrixx, 563 U.S. at 38

(citation omitted).

      The Court dismisses the first half of Statement 23 (“We continue to focus


14Lead Plaintiff and Defendant again submit warring transcripts with respect to
this statement. See ECF Nos. 48-1 at 12 n.4, 53-3 at 4. Again, the Court credits
Plaintiff’s representations at this stage.


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on overcoming manufacturing and supply chain challenges as we ramp up

production of both instruments and cartridges”), however, because the

Company’s “focus” on overcoming its manufacturing and supply chain challenges in

service of its efforts to ramp up production in November 2022 is not materially

impacted by its failure to ultimately do so. Statement 40 can be dismissed for the

same reason. Am. Compl., ¶ 327(t) (regarding Defendants “focus” on “doing all we

can do to get not just RVP4 out, but the other menu items.”). In contrast, the

second half of Statement 23 (“Additionally, we completed development

activities for all Savanna panels planned for launch in 2023.”) survives, as it

directly contradicts former employee accounts. See, e.g., id., ¶ 212 (“FE-2 explained

that the Company’s plan was to fix issues as they went along, working in parallel

with QuidelOrtho’s FDA application to prepare it for launch. This was a high-risk

plan, according to FE-2, because the Company was manufacturing units that it

would have to ultimately pull off the shelves.”).

                 ii.       Puffery

       Statements 20, 21, 29, 33, 34, 38, 45, 46, and 48 are too general to have been

material to a reasonable investor’s analysis. Id., ¶ 327(a)-(b), (j), (n)-(o), (r); id.,

¶ 337(b)-(c), (e). These statements recount the Company’s initial RVP4 Respiratory

Viral Panel menu and its anticipated RVP11 menu with no concrete timeline for

release, see, e.g., id., ¶ 337(b), (c), (e), or constitute “vague descriptions offer[ing]

only generally optimistic opinions,” see, e.g., id., ¶ 327(a)-(b), (j), (n)-(o), (r), and can

thus be classified as “inactionable corporate puffery,” In re Synchrony Fin. Sec.


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Litig., 988 F.3d 157, 170 (2d Cir. 2021). “To be actionably misleading, there must be

a sufficiently close nexus between the statement and the allegedly omitted

information.” Buhrke Fam. Revocable Tr. v. U.S. Bancorp, 726 F. Supp. 3d 315, 340

(S.D.N.Y. 2024) (cleaned up). Such a nexus cannot exist where “exaggerations or

overstatements . . . mention nothing specific, but rather amount to general claims of

superiority expressed in broad, vague, and commendatory language.”

MacNaughton v. Young Living Essential Oils, LC, 67 F.4th 89, 96 (2d Cir. 2023)

(cleaned up). Accordingly, these statements are dismissed.

                iii.      Inactionable Opinion

      Statement 43, Defendant Bujarski’s challenged statement at the Raymond

James Institutional Investors Conference in March 2024, constitutes an

inactionable opinion. 15 Like many “statements of opinion,” Statement 43 includes

“qualifying language (like ‘I believe’ or ‘I think’) that conveys a lack of certainty

about the thing being expressed, marks the statement as reflecting the speaker’s

impression or point of view rather than an objective truth, and makes it easier to

identify the statement as one of opinion rather than fact.” New England

Carpenters, 122 F.4th at 40-41. Further, “[c]ertain statements address issues so


15Am. Compl., ¶ 327(w) (“I think the ones that the field, I would say, is most
interested [in], RVP4 with CLIA Waiver, right? Without the CLIA Waiver, you
just don’t get to the breadth—you don’t get to the breadth of the placement.
So, that’s going to be a key catalyst . . . those are the ones right out of the
gate. So, when you’re thinking about 2024, you’re thinking about our focus,
more so than a revenue number for 2024, any of that. You got to have the
menu to really make this platform a success, and those are the ones that
we’re focused on straight away”).


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plainly subjective . . . that the statement is one of opinion not just by virtue of the

words used but also because of the nature of the information conveyed.” New

England Carpenters, 122 F.4th at 41. Defendant Bujarski’s focus, and his opinion

with respect to what makes a product successful, “lacks any objective standard,” id.

(cleaned up), because it does not implicitly convey facts as to RVP4’s capabilities at

that time. Accordingly, this statement is dismissed.

      The other statements that Defendants challenge as inactionable opinions are

actionable because they “implicitly convey ‘facts about how the speaker has formed

the opinion . . . or . . . about the speaker’s basis for holding that view,’” and the

pleadings plausibly allege such facts to be both false and material. Id. (quoting

Omnicare, 575 U.S. at 188). See, e.g., Am. Compl., ¶¶ 327(c) (“it’s just about—it’s

a matter of timing in terms of FDA clearance.”) (conveying that nature of

product errors were not so significant as to render FDA approval an “if” rather than

a “when”), 327(g) (“We’re still expecting RVP for EUA in April and the 510(k)

will be just shortly after that. So, we’re very much on track for the launch.

As I said, the instrument build issues have largely been resolved. We think

we are already at the capacity to have a meaningful launch. And we’re at

the point where we’re most—most of the effort right now is around cartridge

ramp up . . . we expect to have the ability to make millions of cartridges very

shortly”) (conveying, inter alia, that “instrument build issues ha[d] largely

been resolved,” that “cartridge ramp up” concerns had supplanted more

fundamental concerns regarding widespread detectability failures, that RVP4


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performance as of February 2023 did not render FDA 510(k) approval three months

later an impossibility, and that the promised automated production line was close

enough to producing “millions of cartridges very shortly” that it had, for

instance, a physical location—which Lead Plaintiff alleges it still did not as of April

2024, see id., ¶ 228).

                iv.      PSLRA Safe Harbor

       Defendants argue that several of the challenged statements in this category

are eligible for PSLRA safe harbor protection because they are forward looking,

because they were accompanied by adequate cautionary language, and because

Lead Plaintiff has not proven that the Defendants who made the statements had

actual knowledge that the statement was false or misleading. MTD Mem. at 11-15.

These include statements “containing a projection of revenues” or about “future

economic performance,” 16 15 U.S.C. § 78u-5(i)(1)(A), (C), projecting regulatory

approval for RVP4 and its subsequent U.S. commercial launch,17 and anticipated

manufacturing capabilities and timeline for development of additional Savanna test

panels.18 Many of the statements already dismissed on other grounds—Statements

20, 21, 34, 38, 43, 46, and 48, for instance—would alternatively qualify for dismissal

as immaterial under this doctrine. All of the statements not already dismissed on

other grounds, however, remain actionable.


16 These include Statements 25, 27, 32. See Am. Compl., ¶¶ 327(f), (h), (m).
17 These include Statements 20, 21, 24, 25, 26, 27, 28, 29, 31, 32, 34, 36, 37, 38, 39,
42, and 43. See Am. Compl., ¶¶ 327(a), (b), (e), (g)-(j), (l)-(m), (q)-(s), (v), (w).
18 These include Statements 26, 39, 44, 45, 46, 47, 48. See Am. Compl., ¶¶ 327(g),

(s), 337(a)-(e).


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       Defendants point to oral warnings by Defendants that their “forward-looking

statements were subject to risk factors identified in the Company’s SEC filings,”

which in turn provided cautionary language regarding the Company’s estimated

“regulatory clearance for RVP4 and other assays, as well as underlying assumptions

about development and manufacturability.” MTD Mem. at 13-14 (emphasis added)

(citing ECF Nos. 49-6 at 2, 49-7 at 1-2, 49-12 at 1-2, 49-14 at 2, 49-15 at 1, 49-19 at

1, 49-21 at 3, 49-25 at 2, 49-27 at 2, 49-30 at 2, 49-33 at 1-2). Accepting Lead

Plaintiff’s well-pleaded allegations as true, however, these “underlying

assumptions” were knowingly false. While the Company cautioned that “[f]ailure to

obtain FDA clearance or approval would preclude commercialization in the U.S.,

which could materially and adversely affect our future results of operations,” ECF

Nos. 49-28 at 40-41, 49-8 at 33, it did not disclose material facts about the product’s

unaddressed incompatibility with those FDA clearance standards that would have

meaningfully altered a reasonable investor’s assessment of Savanna RVP4’s

commercial viability. “[C]autionary words about future risk cannot insulate from

liability an issuer’s failure to disclose that the risk has, in fact, materialized in the

past and is virtually certain to materialize again.” Set Cap. LLC v. Credit Suisse

Grp. AG, 996 F.3d 64, 85 (2d Cir. 2021). As Judge Pollack of this District once

noted, “The doctrine of bespeaks caution provides no protection to someone who

warns his hiking companion to walk slowly because there might be a ditch ahead

when he knows with near certainty that the Grand Canyon lies one foot away.” In

re Prudential Sec. Inc. Ltd. P’ships Litig., 930 F. Supp. 68, 72 (S.D.N.Y. 1996).


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                       1.     Revenue Projection Statements

       Contrary to Lead Plaintiff’s assertions, Opp’n at 15, Statements 25, 27, and

32 are forward-looking revenue-projection statements. A statement that references

defendant’s “current expectation of cash flows,” for instance, is forward-looking

because it does “not justify the financial projections in terms of any particular

aspect of the company’s current situation” but instead asserts “only that, whatever

that situation is, it makes the future projection attainable.” Gissin v. Endres, 739

F. Supp. 2d 488, 505-06 (S.D.N.Y. 2010) (cleaned up).

       Yet the projections made in these statements were not attainable. Moreover,

they were not adequately “accompanied by meaningful cautionary language

identifying important factors that could cause actual results to differ materially

from those in the forward[-]looking statements.” In re Nokia Oyj (Nokia

Corporation) Sec. Litig., 423 F. Supp. 2d 364, 400 (S.D.N.Y. 2006) (citing 15 U.S.C.

§ 78u-5(c)).

       Further, as noted supra, see Discussion § B(1)(a)(i), Defendants had actual

knowledge that—unlike Statements 25 and 27 implied—their European revenue

could not offset revenue declines attributable to the delay of Savanna RVP4’s U.S.

launch. Lead Plaintiff adequately alleges, as to the first half of Statement 32, that

Defendant Busky would have known by June of 2023 that “placing . . . boxes” (after

FDA approval) by the fourth quarter of that year was not possible. See Am. Compl.,

¶¶ 327(m), 332 (“FE-2 further explained that Kroll met with the Board and senior

management quarterly to provide project updates on Savanna, and senior


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management . . . was made aware of Savanna’s issues with its failure rate and

assay problems at the time it was submitted to the FDA in mid-2023 and

thereafter.”). Lead Plaintiff has also shown that Defendant Busky possessed actual

knowledge that the second half of Statement 32 was false: “We haven’t really

talked too much about the slope of that revenue ramp in 2024 and 2025. But we

have said that we expect three years post-launch that will be greater than

$250 million of revenue on that Savanna product.” Id., ¶ 327(m). Savanna

revenue projections could not be realized without FDA approval, U.S. launch, and

an automated production line. Id., ¶¶ 95, 222, 343; see also id., ¶ 380 (On July 31,

2024, QuidelOrtho bumps Savanna revenue projections to 2026 after RVP4 FDA

resubmission stalls). Given Defendant Busky’s alleged knowledge that these

milestones would not be possible in the near future, see, e.g., id., ¶¶ 214-220, this

statement does not qualify for safe harbor protection at the pleading stage.

                       2.     Regulatory Approval Statements

      The remaining challenged statements projecting regulatory approval for

RVP4 and its subsequent U.S. commercial launch are ineligible for safe harbor

protection for the same reasons as many of the prior statements. 19 See, e.g.,

Statement 24 (“There’s nothing really different in terms of the timelines that

we’ve communicated before.”); Statement 28 (“[F]rom a timing perspective, I

think we’re in reasonably good shape to be ahead of the upcoming


19These include Statements 24, 26, 28, 29, 31, 36-37, 39, and 42. See Am. Compl.,
¶¶ 327 (e)-(j), (l)-(m), (q)-(s), (v).


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respiratory season. In addition, I think our confidence comes from having

solved supply chain issues and now more reliably making and stocking

instruments. So that’s not going to be a challenge for us. . . .”); Statement 36

(“[W]e’re in good shape. And I would commit to being in market before the

end of the quarter.”).

      Statement 26, made by Bryant in February 2023 during the Q4 2022

Earnings call, is particularly glaring: “We’re still expecting RVP for EUA in

April [2023] and the 510(k) will be just shortly after that. So, we’re very

much on track for the launch. As I said, the instrument build issues have

been largely resolved. We think we are already at the capacity to have a

meaningful launch. . . . [We] expect to have the ability to make millions of

cartridges very shortly.” Id., ¶ 327(g). As alleged, QuidelOrtho’s outlook for FDA

clearance was undeniably bleak in February 2023; some of its instrument build

issues were never resolved; and the Company was lightyears away from the

capacity to make “millions of cartridges.” See, e.g., id., ¶¶ 178 (CAPA investigation

ongoing in 2024), 221-229 (automated manufacturing line never built), 325-26

(continuing instrument build failures), 330 (Company “never met” FDA standards).

      The Amended Complaint sets forth a wide range of troubling allegations as to

Defendants Busky, Bryant, Iskra, and Ranalli’s knowledge that Savanna RVP4

would not receive FDA clearance anywhere near the projected timeframes within

the Class Period. See, e.g., id., ¶¶ 16, 194 (Finance Director FE-10, who was one

reporting level away from Busky from May 2022 through Fall 2023, id., ¶ 55,


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“recounted internal discussions about Savanna where employees joked that the

product was a fraud—QuidelOrtho’s ‘Theranos’’’ and “explained how, in early 2022,

it became ‘a reality’ for the Company that the manufacturing yields for RVP4 test

were too low to receive FDA clearance,” affirmed by “consistent sentiment[s]” of

“longtime FP&A, Accounting and Operations Finance colleagues”), 198-208, 211-12,

216 (“FE-13 corroborated . . . that [because] Savanna was supposed to be the

Company’s next big ‘money-maker,’ . . . issues with Savanna were communicated to

the C-suite ‘all the time.’”), 218 (“According to FE-2, the practice at QuidelOrtho

was for the engineers and scientists to report findings to their managers, who in

turn presented the findings to senior management . . ., specifically . . . Kroll and

Defendant Bujarski, and that information was also forwarded on to Defendants

Bryant and Ranalli[, and] . . . [to] his understanding[,] . . . Defendant Iskra.”), 359-

360, 371; see also id., ¶ 204 (“FE-1 asserted that he had discussions with Bodien and

Novis in late 2023, where it was discussed that QuidelOrtho management—

specifically, according to FE-1’s understanding, Defendant Bryant, Defendant

Bujarski, and Kroll—knew that Savanna RVP4 was not consistently meeting the

FDA’s detectability requirements”).

      Statement 42 falls outside the PSLRA safe harbor for the same reason as the

second half of Statement 32. See supra Discussion B(1)(b)(iv)(1); Am. Compl.,

¶ 327(v) (“$250 million is the goal, and it’s out there . . . whether it’s $250

million, $275 million, or $245 million, it’s a big number; it’s a big

opportunity, and we still believe in it.”).


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                       3.     Statements Regarding Manufacturing Capacity
                              and Additional Panels

      Having already addressed the challenged statements regarding

QuidelOrtho’s anticipated manufacturing capabilities, the Court concludes that the

challenged statements regarding the Company’s development of additional Savanna

test panels are likewise ineligible for safe harbor protection. 20 The Company’s

RVP11 and additional panels, touted to include sexually transmitted infections,

parasites, and gastrointestinal panels, were described by FE-4 as “nearly

impossible” and nothing more than a “pipe dream.” See id. ¶¶ 168-69 (“there was no

evidence at the time that Savanna RVP11 was going to launch in the near future[,]

and . . . the Company knew this at the time the product overview was published”).

Lead Plaintiff has sufficiently pleaded that Defendant Ranalli, as then-Senior Vice

President of the Molecular Business Unit, and Defendant Bryant, as then-CEO,

were briefed on these topics. For instance,

             FE-2 explained in greater detail that everything done
             with developing the Savanna product, including every test
             of its performance, was documented. He noted that any
             change to the engineering or assay was required to be
             documented in a design review. He added that standard
             practice was for the engineers and scientists to report
             findings to their managers, who in turn presented the
             findings to senior management in Power Point
             presentations. Senior management included Kroll and
             Ranalli, who then reported information up to Defendants
             Bujarski and Bryant.”).

Id., ¶ 217; see also id., ¶¶ 42, 183, 185, 195, 369. These statements survive.


20Excluding statements already dismissed or deemed ineligible for safe harbor
protection, these include only Statements 44 and 47. See Am. Compl., ¶ 337(a), (d).


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          c.    Challenged Statements on Savanna RVP4’s Scalability

      Lead Plaintiff contends that the Corporate Defendant and Individual

Defendants Bryant, Busky, Iskra, and Bujarski altogether made 28

misrepresentations during the Class Period about the Company’s ability to

manufacture Savanna RVP4 at the necessary scale to achieve over $75 million in

revenue synergies and $300 million in overall revenue in the near term. Id.,

¶¶ 339-343.

      Defendants’ falsity challenge to these statements largely echo their

arguments regarding RVP4’s European launch and readiness for the U.S. market.

MTD Mem. at 21-22. The Court has already held that Lead Plaintiff plausibly

alleges material misrepresentations associated with the Company’s ability to

manufacture thousands of devices and millions of RVP4 tests once FDA approval

materialized. See supra Discussion § B(1)(b)(i), (iv)(2)-(3); see also Am. Compl.,

¶¶ 174, 194, 221-28. The Court turns to Defendants’ remaining arguments.

                i.      Inactionable Opinion

      All of the statements in this category that Defendants identify as opinions,

MTD Mem. at 11 n.3, are actionable.21 Though several include phrases akin to “[I]

believe” or “[I] think,” “those magic words can preface nearly any conclusion, and

the resulting statements, as [the Supreme Court] ha[s] shown, remain perfectly

capable of misleading investors.” Omnicare, 575 U.S. at 193. Defendant Bryant’s


 These include Statements 52, 57, 63, 64, 69, 71, 73, and 75. See Am. Compl.,
21

¶¶ 339(d), (i), (o), (p), (u), (w), (y), (aa).


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statement in May 2023 on the Company’s Q1 2023 Earnings Call is illustrative:

             I think our confidence comes from having solved
             supply chain issues and now more reliably making
             and stocking instruments. So that’s not going to be
             a challenge for us. And we now have the second line
             nearly validated on the cartridge manufacturing,
             which puts us in really good shape in terms of the
             volumes that we require in 2023 and 2024. So we’re
             pretty confident.

Am. Compl., ¶ 339(p) (Statement 64); see also id., ¶ 339(i) (Statement 57) (“Our two

automated high-volume lines are expected to be up and running by mid-

2023, ahead of our U.S. commercial launch.”). Underlying Bryant’s subjective

assessment of the origins of QuidelOrtho’s “confidence” are his factual assurances

that QuidelOrtho had “solved [its] supply chain issues,” that it was “more reliably

making and stocking instruments,” that doing so was “not going to be a

challenge for” the Company, and that the validation of the Company’s second

cartridge manufacturing line had put it in “really good shape in terms of the

volumes [the Company would] require in 2023 and 2024.” Id., ¶ 339(p). As

discussed, the pleadings amply allege otherwise. See, e.g., id., ¶¶ 212, 224-228, 340-

43. “[O]ne of the more straightforward ways a statement of opinion may be

actionable is if it contains an embedded statement of fact that is not true.” New

England Carpenters, 122 F.4th at 42. As these statements contain several false

assertions that do not “turn[] on the exercise of subjective judgment,” id. at 41, they

are not inactionable opinions.

               ii.      Puffery

      None of the statements in this category that Defendants contend are


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inactionable puffery qualify as such.22 In a representative example, Defendant

Bryant reported on the Q1 2022 Earnings Call in May 2022 that “the only

constraint with the launch, honestly, [is] our ability to get enough

instruments into the market as quickly as possible as well as our ability to

manufacture cartridges at very, very high volumes.” Am. Compl., ¶ 339(d)

(Statement 52). Like the other statements at issue, and unlike inactionable

statements of corporate optimism, this statement is verifiably false. See Oklahoma

Firefighters, 300 F. Supp. 3d at 570; see also Abramson, 965 F.3d at 178. Taking

Lead Plaintiff’s allegations as true, there were clearly other constraints on the

launch besides the speed and volume at which QuidelOrtho could bring Savanna

RVP4 to market: namely, that the product didn’t work. See, e.g., Am. Compl., ¶¶ 16

(“person responsible for validating the RVP4 test results for its FDA submissions

. . . , at the time when FDA submissions were being filed, [shared] that Savanna

RVP4 ‘does not work’ and that it ‘isn’t even a product.’”), 173 (“widespread failure”

with Savanna device and test assay “not working ‘from the very beginning’”), 175

(one in four test instruments in Europe did not work), 179 (European customers

reported nonworking Savanna devices and invalid results, which persisted through

June 2024), 180 (RVP4 “test wasn’t stable enough to launch to market” in May

2024), 192 (FDA submissions had “glaring issues” and RVP4 tests “never worked

properly”), 194 (since early 2022, longtime employees’ “‘consistent sentiment’ was


22These include Statements 52, 55, 56, 61, 64, 69, 70, and 75. See MTD Mem. at 16
n.10 (citing Am. Compl., ¶ 339(d), (g), (h), (m), (p), (u), (v), (aa)).


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that they did not think the test ‘would ever work’”), 195 (at time of Quidel and

Ortho merger, colleagues remarked, “wait until they see [Savanna] doesn’t work”

and is “not a real thing”), 372 (“at least half of the tests produced were defective and

scrapped right after manufacturing”).

      Because all challenged statements in this category are sufficiently specific to

cause a reasonable investor to rely upon them, they cannot be dismissed as mere

puffery. See Oklahoma Firefighters, 300 F. Supp. 3d at 570 (“statements

address[ing] concrete and measurable areas of the defendant company’s

performance” are not inactionable puffery (citation omitted)).

              iii.      PSLRA Safe Harbor

      Nearly all of the challenged statements about Defendants’ manufacturing

capacity, ability to hit the ground running with U.S. production and distribution

after FDA approval, and related near-term revenue projections are forward-

looking. 23 Again, however, “[c]autionary words about future risk cannot insulate

from liability the failure to disclose that the risk has transpired.” Rombach, 355

F.3d at 173. As established, Defendants’ cautionary language was insufficient to

protect their statements about QuidelOrtho’s manufacturing capacity and resultant

revenue projections from liability because those warnings did not disclose that the

Company had already failed to achieve necessary predicates to their predictions.24


23 These include Statements 49-64, 66-67, 69-76. See MTD Mem. at 16 & nn.3-7
(citing Am. Compl., ¶ 339(a)-(p), (r), (s), (u)-(z), (aa)-(bb)).
24 See, e.g., Am. Compl., ¶ 339(e) (Defendant Bryant on the Q1 2022 Earnings Call in

May 2022: “Once online in the fall, our Savanna cartridge automated
manufacturing line is expected to begin its ramp-up and outfit to over 1


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The Court has also already determined that investors were not adequately warned

of risks associated with Defendants’ statements about Savanna RVP4’s FDA

approval timeline,25 see supra Discussion § B(1)(b)(iv)(1)-(2), and that Defendants

Bryant, Busky, Iskra, Bujarski, and senior executives more broadly had actual

knowledge that their statements about the Company’s ability to manufacture at

scale were misleading, see supra Discussion § B(1)(b)(iv)(2). Accordingly, none are

protected.

          d.      Challenged Statements regarding QuidelOrtho’s endemic
                  COVID-19 Revenue

       Lead Plaintiff contends that the Corporate Defendant and Individual

Defendants Bryant and Busky altogether made 28 misrepresentations regarding

the Company’s endemic COVID-19 revenue during the Class Period. Am. Compl.,

¶¶ 344(a)-(v), 350, 351. Many of the statements in this category specifically address

QuidelOrtho’s multi-year endemic COVID-19 guidance of $200-400 million annually

(“endemic range statements”), 26 some address the Company’s future endemic


million cartridges per month with $300 million annual revenues and
anticipated within 3 years of U.S. launch.”).
25 See, e.g., Am. Compl., ¶ 339(v) (Defendant Bryant on the Q3 2023 Earnings Call

in November 2023: “I am confident we will receive Savanna instrument
clearance by the end of this year and launch commercially in the U.S. very
quickly thereafter.”); id., ¶ 339(k) (Defendant Bryant on the 2022 Investor Day
Call in December 2022: “. . . That’s three years post the US launch. So it’s
sometime[,] call it mid-to-late-2023; three years beyond that is where you’ll
see that number. I would argue it’s largely the same number, Patrick. I
mean, it’s greater than 250 [million].”
26 These include Statements 78, 82-86, 90-92, 97-98, and 101-02. Am. Compl.,

¶ 344(b), (e)-(j), (l)-(n), (r), (u)-(v). Statements 82 and 84, id., ¶ 344(e), (g), project an
additional $100 million to account for a secured government contract in 2023.


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COVID-19 trends more broadly (“general prospects statements”), 27 others

characterize the Company’s past or present performance within the respiratory

market (“market position statements”), 28 and a few discuss respiratory market

trends at large (“market trend statements”). 29 Two encompass regulatory

disclosures and certifications.30

                i.      Falsity and Puffery 31

      The endemic range statements can be divided into two groups: those that

explicitly tie the $200-$400 million projection to fiscal years beyond 202332 and

those that may be construed as applying to fiscal year 2023 only.33 Although Lead

Plaintiff does not differentiate between these two statement types, the distinction is

consequential. As alleged, the statements that reassure investors the $200-$400

million projection would hold for years to come are material misrepresentations,

whereas those that do not are less likely to have misled investors. This is because

Lead Plaintiff has sufficiently alleged that—between missed sales quotas,

impending end-of-life concerns for the Sofia line of products, Savanna RVP4’s

unviability, QuidelOrtho’s loss of market share, and skyrocketing excess and


27 These include Statements 81 and 87. Am. Compl., ¶ 344(e), (j).
28 These include Statements 77, 79, 93-94, 96, and 99-100. Am. Compl., ¶ 344(a), (c),
(o), (q), (s)-(t).
29 These include Statements 80, 88-89, and 95. Am. Compl., ¶ 344(d), (k), (p).

30 These include Statements 103 and 104. Am. Compl., ¶¶ 350-51.

31 None of the challenged statements in this category are inactionable opinions.

32 These include Statements include 83, 90, 92, 97, and 102. Am. Compl., ¶ 344(f),

(l), (n), (r), (v).
33 These include Statements 78, 82, 84-86, 98, and 101. Am. Compl., ¶ 344(b), (e),

(g)-(i), (r), (u).


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obsolete (“E&O”) inventory—there was no path to achieving revenue within the

$200-400 million range after 2023. See, e.g., Am. Compl., ¶¶ 139-45 (end-of-life

forecast for Sofia 1 and 2), 213 (Savanna not passing QuidelOrtho’s internal

qualifications or testing in 2022 and early 2023), 236-76 (sales quotas missed—and

progressively tanked—in every quarter of 2023; commission only paid if

salespeople’s percent to forecast hit 93%, but average percent to forecast was 65-

68%; E&O hit unprecedented levels), 354 (loss of market share), 378 (“Defendant

Busky received reports detailing how COVID-19 sales quotas were missed ‘by a

mile’ throughout 2023”).

      Throughout fiscal year 2023, however, these realities were still taking shape.

See, e.g., id., ¶¶ 237 (sales representatives attempted unsuccessfully to “stop the

bleeding” of declining business and revenue loss in 2023), 240 (“COVID test sales at

QuidelOrtho began declining in late 2022”), 241 (“FE-15 recalled that he saw

‘significant’ change in the behavior of customers between late Fall 2022 and early

Spring 2023,” by which time 30-40% of customers had stopped purchasing from

QuidelOrtho because they were “not testing for COVID as frequently” and

“purchasing newer tests from competitors”); 244 (“COVID tests sales in hospitals

were ‘completely gone’ in 2023 and . . . Quidel’s acute business ‘disappeared

overnight’”). Clocking out at $260 million in endemic COVID revenue, discounting

government contracts, id., ¶ 296 n.13, the Company’s final revenue numbers for

2023 were within the projected range—though shocking and disappointing to

investors, see id., ¶¶ 291 (2023 “Q4 came in as one of the most surprising results we


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have seen in diagnostics in some time—and not in a pleasant way for

shareholders.”), 292 (William Blair analysts decry “disconnect” between the

expectations set by QuidelOrtho management and the Company’s fourth quarter

and fiscal year 2023 results” and characterize QuidelOrtho shares as “in the penalty

box” until management can “rebuild some credibility”). Accordingly, Statements 78,

82, 84-86, 98, and 101 cannot be considered false and are dismissed.

      In contrast, the general prospects statements constitute material

misrepresentations because they project a picture of the Company’s respiratory

market outlook made impossible by documented realities at the time the statements

were made. For instance, during the Q4 2022 Earnings Call in February 2023,

Defendant Busky made Statement 81: “We expect to continue to capture and

grow our share of the respiratory market, underpinned by our large and

growing Sofia placements.” Id., ¶ 344(e). By February 2023, Sofia had no

chance of “underpinn[ing]” QuidelOrtho’s capture of, or growth in, the respiratory

market because Sofia placements were not “large and growing” but rather careening

toward obsolescence. See e.g., id., ¶¶ 138 (“QuidelOrtho’s dominant point of care

immunoassay—the Sofia 1 and Sofia 2 analyzers—faced end-of-life threats early on

in the Class Period.”), 139 (“according to . . . several former employees, by no later

than mid-2023, the Sofia platform faced critical ‘end-of-life’ concerns that posed a

threat to its continued revenue contributions.”), 147 (“Sofia analyzers’ sales

potential also suffered because customers were choosing more modern technology

over what the Sofia platform could offer. . . . [B]y the time of the Merger,” FE-3, a


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former salesman and business developer for the Company, “received feedback from

some of his current and prospective QuidelOrtho customers that the Company’s

analyzers—including specifically the Sofia analyzers—‘did not hold up’ and

therefore customers purchased tests from competitors because they had more state-

of-the-art products.”), 148 (“there was less demand for the Sofia analyzer and other

immunoassay tests because competitors’ molecular tests had substantially higher

reimbursement rates.”). Further, Defendant Bryant’s statement at the Raymond

James Annual Institutional Investors Conference in March 2023 that the

Company’s EBITDA expectations in “2024 should be better than 2023 and [in]

2025 better than 2024,” id., ¶ 344 (j), was materially misleading given the

Company’s sales drop-offs and end-of-life concerns for its major COVID-19 products.

See e.g., id., ¶¶ 236-76.

       Most, but not all, of Defendants’ market position statements were material

misrepresentations. For instance, Lead Plaintiff alleges with damning specificity


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that Statements 77, 34 94, 35 and 10036 materially misled investors. In contrast,

Statement 79 is certainly misleading, but it fails on puffery grounds along with

Statement 99. 37 Because these statements “lack the sort of definite positive


34 Compare Am. Compl., ¶ 344(a) (“[W]e don’t have so much of a demand
problem right now. We have a supply problem. We got to get more
products.”), with id., ¶¶ 233 (“huge decline” in COVID test sales beginning in
August 2021, such that distributors couldn’t resell to end-users and “tests kits . . .
were never moved from distribution warehouses”), 245 (“Quidel provided the
[hospital] conglomerates and other acute customers free COVID demo kits and
heavily discounted COVID tests to its customers because there was an ‘urgency’ to
sell them in Q4 2022 [and] Q1 2023”); 246 (FE-16 and his sales colleagues
throughout the U.S. “all talked about how no one was buying QuidelOrtho’s acute
products” and “asked each other what they were doing with all the Quidel products
that they were unable to sell.”), 247 (FE-17, “[a]nother Account Executive
responsible for selling all of Quidel’s respiratory products, including the Lyra, Sofia
and Solana, to distributors, hospitals, reference labs, and private practices . . .
recalled that in 2022 and 2023, ‘no one’ was buying COVID tests.”).
35 Compare Am. Compl., ¶ 344(o) (Defendant Bryant, discussing the “overall

market for respiratory testing and our respiratory business” in November
2023 during the Q3 2023 Earnings Call, describes “significant share gains from
competitors for us specifically.”), with id., ¶ 347 (QuidelOrtho was “losing
market share to competitors whose tests offered more flexibility or better
technology”).
36 Compare Am. Compl., ¶ 344(t) (“[W]e historically have preannounced when

we have something that’s materially different than you think. . .[s]o, we
didn’t actually see a need to do that and we’ll have plenty to talk about at
the earnings call here in a few weeks.”), with id., ¶ 281 (“William Blair analysts
commented that QuidelOrtho’s decision not to pre-release its fourth quarter and full
year 2023 financial results ‘surprised investors,’ but that this was not a cause for
alarm because: ‘Mgmt. was clear: if nothing materially different from range,
no need to prerelease’ [so] ‘23 guidance (rev and profits) appears intact’. . .
and that ‘Q1 [2024] looks like a normal respiratory season.’”), and id., ¶ 283
(Defendant Bryant “will not sugarcoat the fact that our fourth quarter numbers fell
short of our expectations”), and id., ¶ 286 (“Defendants . . . in January . . . [were]
fully aware [that] . . . total revenue . . . was about 6% or 7% of what we had
projected.”).
37 Am. Compl., ¶ 344(c) (“But part of beating expectations is to set the

expectations correctly. And so we’re pretty humble with the street. We don’t
get ahead of our skis, as they say. We don’t try to . . . say things that would
hype the share price. We just, you know, we call it like we see it.”); id.,


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projections that might require later correction,” In re Vivendi, 838 F.3d at 245

(citation omitted), they are inactionable statements of corporate optimism. See

Abramson, 965 F.3d at 173 (securities laws do not “require[] corporate officials to

present an overly gloomy or cautious picture of current performance and future

prospects.” (cleaned up)). Statement 93 fails because Lead Plaintiff does not allege

facts with specificity to conclude that the third quarter of 2023 did not have “strong

and early respiratory demand” as Defendant Bryant represented on the Q3 2023

Earnings Call. Am. Compl., ¶ 344(o). Statement 96 similarly fails because Lead

Plaintiff does not allege that QuidelOrtho’s 2023 Q2 “financial performance” did

not “exceed[] [its] plan significantly.” Id., ¶ 344(q). While Lead Plaintiff does

allege that the Company’s salespeople did not hit their quotas that quarter, id.,

¶ 346, the Teamsters Funds do not advance overall Q3 projections against which to

measure QuidelOrtho’s ultimate Q3 performance.

      Defendants’ market trend statements would not have materially misled

reasonable investors because they were not concretely tied to QuidelOrtho’s

performance. 38 Accordingly, these statements are dismissed.


¶ 344(s) (“So, we continue to do well in this space [with respect to Sofia]. I
don’t want to sound arrogant, but I do want to point out that we do pretty
well in this space, so, and it’s our highest market share category.”).
38 See Am. Compl., ¶ 344(d) (COVID-19 is “definitely not declining though. And

so it’s become somewhat steady state.”), (k) (“Demand for diagnostics across
the health care continuum remained strong.”), (k) (“significant increase in
global demand for global testing.”), (p) (“The key difference is that the
overall respiratory market, including COVID-19 now in its current endemic
state is significantly larger than it was pre-pandemic. And QuidelOrtho’s
position in the overall diagnostics market, including respiratory, is much
stronger as a combined company than either company was on a standalone


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      Finally, Statements 103 and 104 are QuidelOrtho’s regulatory disclosures

and certifications. Am. Compl., ¶¶ 350-51. While these 10-Ks, 10-Qs, and

Sarbanes-Oxley Act of 2022 (“SOX”) certifications are insufficient to shield many of

the other statements from liability, see infra Discussion § B(1)(d)(ii), they are not in

and of themselves false. Accordingly, they are dismissed.

               ii.      PSLRA Safe Harbor

      The remaining forward-looking statements not already dismissed address

Defendants’ market share and endemic COVID-19 revenue projections for fiscal

year 2023 and beyond.39 Defendants point to their SEC filings as providing

“[m]eaningful cautionary language” with “detailed warnings about risks to

QuidelOrtho’s future financial performance and business.” MTD Mem. at 13-14.

QuidelOrtho’s 2022 Form 10-K filed on February 23, 2023 (“2022 10-K”) is

illustrative, as the Company’s quarterly 10-Qs for 2023 incorporate it by reference

through November 2023.40 The 2022 10-K provides, in relevant part:


basis. Contrary to some recent opinions, we believe as evidenced by our
results, the market, the diagnostics market is positioned for continued
durable growth for many years to come.”).
39 These include Statements 81, 83, 87, 90, 92, 97, and 102. Am. Compl., ¶ 344(e)-(f),

(j), (l), (n), (r), (v).
40 QuidelOrtho Corp., Quarterly Report (Form 10-Q), at 36 (filed May 4, 2023),

https://www.sec.gov/Archives/edgar/data/1906324/000190632423000033/qdel-
20230402.htm (“There has been no material change in our risk factors as previously
disclosed in our Annual Report on Form 10-K for the fiscal year ended January 1,
2023.”); QuidelOrtho Corp., Quarterly Report (Form 10-Q), at 35 (filed Aug. 9,
2023), https://www.sec.gov/Archives/edgar/data/1906324/000190632423000046/qdel-
20230702.htm (same); QuidelOrtho Corp., Quarterly Report (Form 10-Q), at 36
(filed Nov. 2, 2023),
https://www.sec.gov/Archives/edgar/data/1906324/000190632423000058/qdel-
20231001.htm (same).


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             . . . The gross margins derived from sales of our COVID-
             19 and influenza tests are generally significantly higher
             than the gross margins from many of our other core
             products. As a result, if sales or revenues of our COVID-
             19 or influenza tests fluctuate or decline for any reason,
             whether as a result of a waning of the COVID-19
             pandemic, a mild flu season, market share loss or price
             pressure, obsolescence, regulatory matters, such as loss of
             EUAs from the FDA for our COVID-19 products, or any
             other reason, our operating results would be materially
             and adversely affected on a disproportionate basis.

Am. Compl., ¶ 350. Because several of the hypothetical risks listed in this

disclosure (e.g., market share loss and obsolescence) had already manifested by the

time many of these SEC filings were released, such cautionary language does not

offer safe harbor protection.

      The Amended Complaint is also replete with allegations that Defendants

Busky and Bryant were aware that QuidelOrtho’s sales and E&O metrics rendered

their revenue and market share projections fantastical. See, e.g., id., ¶¶ 144 (“FE-4

confirmed that current Director, Global Product Management Sean Redmond,

former Senior Vice President POCT Business Unit Bill Ferenczy and current Vice

President, Strategy and Portfolio Management Rhys de Callier, each of

whom were ‘close’ to Defendant Bryant, were aware of the ‘major concerns’ about

Sofia”), 232 (“this projection of $200 to $400 million in COVID-19 endemic revenue

was in direct conflict with the Company’s actual COVID-19 test sales and revenue

trends, all of which were directly reported to senior management, including the

Individual Defendants.”), 236-238 (“FE-3 noted that he logged feedback from [his]

conversations” with customers who “purchased tests from competitors because they


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had more state-of-the-art products . . . in CRM Salesforce and shared the feedback

in weekly meetings” with his team and supervisor who reported to VP of Sales John

Meckles. “According to FE-3, [his supervisor] thereafter attended business manager

meetings where sales were discussed with senior management”), 251 (“the inflated

sales quotas were identified at the start of 2023 and brought to the attention of

senior management, including the Individual Defendants”), 257 (“upper

management utilized Microsoft Power BI to analyze data and ‘see the bigger

picture,’ i.e., all of the Company’s territories,” where the “huge decline in the Quidel

side of the business . . . was seen ‘easily and obviously.’”), 264 (“These missed sales

quotas and lower customer demand for COVID-19 products were communicated

directly to the highest levels of senior management, including Defendant Busky.”),

265 (Defendant Busky attended meetings about the Company’s sales analysis

throughout 2023), 276 (“FE-10 maintained and updated a report called the

McKellar Report, which included sales data for raw materials and finished goods,

how much product was selling each week, and how much of each product the

Company had in inventory. FE-10 stated that the McKellar Report reflected that

‘nothing is selling’ and that inventory levels were going ‘up, up, up’ beginning in

early 2021 and consistently increased throughout FE-10’s tenure. FE-10 stated

that Jenkins provided E&O numbers to CFO Defendant Busky.”), 278 (FE-10

discussed inventory analysis and data directly with Defendant Busky); see also id.,

¶ 265. Accordingly, the PSLRA’s safe harbor does not shelter these statements.


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   2.      Scienter

        The Supreme Court has instructed that a “strong inference” of scienter “must

be more than merely plausible or reasonable—it must be cogent and at least as

compelling as any opposing inference of nonfraudulent intent.” Tellabs, 551 U.S. at

314 . This inference need not be “irrefutable,” of the “smoking-gun genre,” or the

“most plausible of competing inferences,” rather, courts consider “whether all of the

facts alleged, taken collectively, give rise to a strong inference of scienter, not

whether any individual allegation, scrutinized in isolation, meets that standard.”

Id. at 323-24. “Courts in this district generally conclude that the scienter of

‘management level’ employees can be attributed to the corporation.” In re ASML

Holding N.V. Sec. Litig., 825 F. Supp. 3d 208, 239 (S.D.N.Y. 2026) (citation

omitted); Thomas v. Shiloh Indus., Inc., No. 15-CV-07449 (KMW), 2017 WL

2937620, at *3 (S.D.N.Y. July 7, 2017) (same) (collecting cases).

        In this Circuit, “[a] plaintiff may establish scienter by alleging facts showing

that (1) the defendants had the motive and opportunity to commit fraud, or (2)

strong circumstantial evidence of conscious misbehavior or recklessness.” Gimpel

156 F.4th at 144 (cleaned up). If plaintiffs cannot make a showing of motive, “the

strength of the circumstantial allegations must be correspondingly greater.” ECA,

553 F.3d at 198-99 (cleaned up). Further, “personal financial gain may weigh

heavily in favor of a scienter inference.” Slayton, 604 F.3d at 776 (quoting Tellabs,

551 U.S. at 325).


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      a.     Motive and Opportunity

      To raise an inference of scienter under motive and opportunity, a plaintiff

must show that the corporation or its officers “benefitted in some concrete and

personal way from the purported fraud.” zCap Equity Fund LLC, 792 F. Supp. 3d

at 440 (quoting Novak, 216 F.3d at 307-08). The Amended Complaint imputes such

a motive to the Individual Defendants, alleging that “C-suite bonuses were tied to

achieving ‘certain Savanna launch targets,’” and “former employees confirm that

compensation structure motivated the unrealistic and intense pressure surrounding

Savanna.” Am. Compl., ¶ 381 (internal quotation marks omitted); see also id., ¶ 136

(“[T]he Executive Steering Committee[, which included Defendants Steward and

Bujarski,] pushed the Savanna RVP4 project through even though they knew it was

flawed because they were under pressure to release the product, and because they

wanted to get paid their bonuses, . . . [and] Kroll, Defendant Steward, and

Defendant Bujarski had large incentives in their employment contracts that were

tied to Savanna RVP4 advances. . . . Defendant Bryant oversaw Quidel’s Executive

Steering Committee for the Savanna project.”).

      b.     Circumstantial Evidence of Conscious Misbehavior or
             Recklessness

      For 10b-5 actions in this Circuit, recklessness is defined as “at the least, . . .

an extreme departure from the standards of ordinary care . . . to the extent that the

danger was either known to the defendant or so obvious that the defendant must

have been aware of it.” zCap, 792 F. Supp. 3d at 440 (cleaned up). As relevant

here, pleadings must that show Defendants “knew facts or had access to


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information suggesting that their public statements were not accurate” or “failed to

check information they had a duty to monitor” give rise to an inference of scienter.

Id. (cleaned up). The Court has discussed at length the extent to which

Defendants Bryant, Busky, Iskra, and Ranalli “knew facts or had access to

information suggesting that their public statements were not accurate.” See supra

Discussion § B(1)(a)(iv), (b)(iv), (c)(iii), (d)(ii).

       Further, “[t]he timing of terminations and resignations, in relation to the

magnitude of corrections in a restatement, also can be a strong inference of scienter,

approaching recklessness or even conscious malfeasance as to the targeted

individuals.” In re Pareteum Sec. Litig., No. 19-CV-09767 (AKH), 2021 WL

3540779, at *17 (S.D.N.Y. Aug. 11, 2021) (cleaned up). Taken alongside the rest of

the Amended Complaint, CEO Bryant’s termination a week after the corrective

market reaction to QuidelOrtho’s 2023 Form 10-K, Am. Compl., ¶ 300-01, and

Defendants Bujarski and Iskra’s firings that July after the Company continued to

perform below touted expectations, id., ¶¶ 27, 380, are probative of these Individual

Defendants’ recklessness.

       Accordingly, the Court finds that Lead Plaintiff has adequately alleged

scienter as to both the Individual Defendant and QuidelOrtho. 41 See Teamsters

Local 445 Freight Div. Pension Fund v. Dynex Capital, Inc., 531 F.3d 190, 195 (2d

Cir. 2008) (“In most cases, the most straightforward way to raise such an inference


 Finding Lead Plaintiff’s alternate arguments sufficient to plead scienter, the
41

Court does not address the parties’ core operations doctrine arguments. See MTD
Mem. at 31; Opp’n at 28.


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for a corporate defendant will be to plead it for an individual defendant.”).

C.    Scheme Liability under Rule 10b-5(a) and (c)

      To state a scheme liability claim, a plaintiff must allege “(1) manipulative

acts; (2) damage (3) caused by reliance on an assumption of an efficient market free

of manipulation; (4) scienter; (5) in connection with the purchase or sale of

securities; (6) furthered by the defendant’s use of the mails or any facility of a

national securities exchange.” ATSI, 493 F.3d at 101. “Unlike a misrepresentation

or omission claim under Rule 10b-5(b), [a] scheme liability claim is aimed at

inherently deceptive conduct and does not require a misleading statement or

omission.” In re AT&T/DirecTV Now Sec. Litig., 480 F. Supp. 3d 507, 534 (S.D.N.Y.

2020) (cleaned up), aff’d sub nom., Steamfitters Loc. 449 Pension Plan v. AT&T Inc.,

No. 21-2698-CV, 2022 WL 17587853 (2d Cir. Dec. 13, 2022) (summary order).

Instead, “scheme liability is triggered where the defendant performed an inherently

deceptive act that was distinct from an alleged misstatement: i.e., sham

agreements, sham transactions, sham companies.” SEC v. Farnsworth, 692 F.

Supp. 3d 157, 189 (S.D.N.Y. 2023) (cleaned up). Accordingly, while “misstatements

and omissions can form part of a scheme liability claim, . . . an actionable scheme

liability claim also requires something beyond misstatements and omissions.” SEC

v. Rio Tinto PLC, 41 F.4th 47, 49 (2d Cir. 2022).

      While the misrepresentations set forth in the Amended Complaint certainly

augment Lead Plaintiff’s scheme liability claim, see Am. Compl., ¶ 429(a)-(g), they

are not its only support. Lead Plaintiff’s other allegations in support of scheme


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liability include, inter alia, inflated sales goals, concealing the CAPA investigation

and negative customer feedback in Europe, dismantling and downsizing the

Savanna RVP4 team in favor of a more insular team, advertising additional

Savanna panels that did not exist, doubling endemic COVID revenue projections

without substantiation, and submitting Savanna RVP4 to the FDA despite known

insufficiencies. Id., ¶¶ 115, 168-69, 178-79, 183-84, 198, 200-04, 207, 359-60, 429;

see also, id., ¶¶ 134-35 (to “push” Savanna “over the goal line,” “Defendant Steward

and Defendant Bujarski . . . ‘championed’ cutting corners on the RVP4 project . . .

through the second half of 2023,” including by “skipp[ing] quality steps like

reliability testing . . . because there were flaws with the Savanna RVP4

instrumentation, [such that] the RVP4 instrument and cartridge would break and

fail and therefore the Company could not run a reliability test.”), 201 (employees

believed the Company made its Savanna RVP4 FDA submission in 2023 to boost

the Company’s stock price), 370 (After team developing Savanna RVP4 told Kroll

the test had manufacturability concerns that would prevent it from being reliably

manufactured, QuidelOrtho did not “proceed with a ‘design review,’ the next step on

a normal trajectory at a medical device company.” Instead, “Kroll and Defendants

Steward and Bujarski held a meeting in 2020 where they ‘dismantled’ the large

team working on Savanna to assemble a small, ‘insular’ team to handle it going

forward,” allegedly to “insulate information from the rest of the Company about

issues with Savanna RVP4 and ‘push it’ to production and R&D.”). Accordingly,

this claim survives.


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D.    Control Person Liability Under Section 20(a)

      Section 20(a) of the Exchange Act assigns joint and several liability to every

person who controls any person liable under any provision of the Exchange Act. 15

U.S.C. § 78t(a). To state a claim under section 20(a), “a plaintiff must show (1) a

primary violation by the controlled person, (2) control of the primary violator by the

defendant, and (3) that the defendant was, in some meaningful sense, a culpable

participant in the controlled person’s fraud.” Okla. Firefighters, 300 F. Supp. 3d at

569-70 (cleaned up).

      Defendants’ sole argument for dismissal of this claim is that Lead Plaintiff

fails to plead a “primary violation” under Section 10(b) that would allow for a claim

under Section 20(a). MTD Mem. at 35. As discussed at length, Lead Plaintiff’s

Section 10(b) claims survive Defendants’ motion, so its claims arising under Section

20(a) may proceed as well. See, e.g., Ark. Pub. Emps. Ret. Sys., 28 F.4th at 356-57

(2d Cir. 2022).

                                   CONCLUSION

      Accordingly, Defendants’ Motion to Dismiss is GRANTED IN PART AND

DENIED IN PART. Both motions to strike are DENIED. The Clerk of Court is

respectfully directed to terminate ECF Nos. 47, 51, and 57.

      SO ORDERED.

Dated: September 30, 2026                      ______________________________
       New York, New York                         JEANNETTE A. VARGAS
                                                 United States District Judge


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Statement #   Complaint ¶       Date and Source         Speaker                                         Alleged Misrepresentation

                                                           European Launch of Savanna RVP4


                                   2/17/2022                        “Based on customer reviews in Europe, we believe Savanna will be a major growth driver, both
    1            321(a)                                 Bryant
                            Q4 2021 Earnings Release                in the U.S. and globally, for years to come.”


                                                                    “We’re in market in a limited launch with our Respiratory Viral Panel 4 respiratory panel and
                                  2/17/2022
    2            321(b)                                 Bryant      have received very positive customer feedback to date, including requests for additional
                             Q4 2021 Earnings Call
                                                                    instruments .”

                                     3/9/2022
                             Raymond James Annual                   “That’s Savanna, that’s beautiful, performing very nicely in Europe right now. We’re hearing
    3            321(c)                                 Bryant
                              Institutional Investors               really nice feedback. I think it’s the right design for the market at this time. ”
                                    Conference

                                                                    An analyst asked about Savanna and whether any of its panels were “more applicable” to different
                                     3/9/2022                       locations. In response, Defendant Bryant stated: “We launched in Europe, it was the safest, easiest.
                             Ra