Securities Regulation Daily Wrap Up, FRAUD AND MANIPULATION—N.D. Cal.: iRhythm CEO made false and misleading statements about company’s heart monitoring device, (Nov 10, 2025)

By R. Jason Howard, J.D.

The law of the case doctrine prevented the court from reexamining settled issues.

The Northern District of California has denied a motion for judgment on the pleadings brought by defendants, iRhythm Technologies, Inc., and its CEO because the court had previously ruled that the plaintiff adequately alleged the CEO’s scienter and loss causation in an order granting in part, and denying in part, the defendants’ motion to dismiss (Glazing Employers and Glaziers Union v. iRhythm Tech., Inc., No. 3:24-cv-00706-JSC (N.D. Cal. Nov. 7, 2025)).

iRhythm. The plaintiff brought the Private Securities Litigation Reform Act (PSLRA) putative class action against iRhythm Technologies and its CEO for allegedly making false and/or misleading statements regarding iRhythm’s Zio AT, a device which transmits heart event data for physician monitoring.

The court granted in part, and denied in part, the defendant’s motion to dismiss, ruling that the plaintiff adequately alleged that the CEO made false or misleading statements and had scienter beginning in July 2022. The plaintiff did not amend the complaint following the court’s order, and thereafter the defendants filed their motion for judgment on the pleadings.

Motion for judgment on the pleadings. The defendants’ motion for judgment on the pleadings argued that the plaintiff failed to adequately plead the CEO's scienter and loss causation, but the court previously ruled otherwise and stated that the defendants’ motion was barred by the law of the case doctrine.

The court explained that the law of the case doctrine, which “generally provides that when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case,” prohibited the court from reexamining those issues absent a motion for reconsideration. The court further explained that the motion for reconsideration would not have been successful because the defendants failed to show at least one of the following:

1. That at the time of the motion for leave, a material difference in fact or law exists from that which was presented to the court before entry of the interlocutory order for which reconsideration is sought. The party also must show that in the exercise of reasonable diligence the party applying for reconsideration did not know such fact or law at the time of the interlocutory order; or

2. The emergence of new material facts or a change of law occurring after the time of such order; or

3. A manifest failure by the court to consider material facts or dispositive legal arguments which were presented to the court before such interlocutory order.

Conclusion. Because the court expressly decided the questions of the CEO’s scienter as to the false and misleading statements and loss causation under the PSLRA’s pleading standards, the court denied the defendants’ motion for judgment on the pleadings.

The case is No. 3:24-cv-00706-JSC.

Judge: Corley, J.

Attorneys: Jonathan D. Uslaner (Bernstein Litowitz Berger & Grossmann LLP) for Glazing Employers and Glaziers Union Local #27 Pension and Retirement Fund. Christopher Darnell Porter (Quinn Emanuel Urquhart & Sullivan, LLP) for iRhythm Technologies, Inc., Quentin Blackford, Brice Bobzien, Douglas Devine, Chad Patterson and Mintu Turakhia.

Companies: Glazing Employers and Glaziers Union Local #27 Pension and Retirement Fund; iRhythm Technologies, Inc.

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