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Securities Law Firm Files Lawsuit Against Fortrea Holdings Inc.

Strategic Insights

— 1 min read

A securities law firm has filed a lawsuit against Fortrea Holdings Inc. and its senior executives, alleging potential violations of federal securities laws. The lawsuit, Deslande v. Fortrea Holdings Inc., et al., was filed on July 19, 2025, in the U.S. District Court for the Southern District of New York. The complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors who purchased Fortrea securities. The case is related to Fortrea's spun-off status from Labcorp Holdings Inc. in June 2023 and its subsequent financial performance.

Key Takeaways:

  • Fortrea Holdings Inc. is a global contract research organization that provides biopharmaceutical product and medical device development solutions.
  • The company was spun off into a standalone, publicly traded company by Labcorp Holdings Inc. in June 2023.
  • Fortrea entered into several transition services agreements (TSAs) with Labcorp, which resulted in significant cost savings and margin improvements.
  • However, the company allegedly overstated the cost savings and margin improvements it would achieve from exiting the TSAs.
  • The stock price declined by $2.73 per share (over 12%) on September 25, 2024, after investment bank Jefferies published a report questioning the materiality of the cost savings.
  • The stock price declined by an additional $3.47 per share (over 25%) on March 3, 2025, after Fortrea announced disappointing Q4 and full year 2024 financial results.
  • The lawsuit seeks compensation for investors who purchased Fortrea securities.
  • The case is pending in the U.S. District Court for the Southern District of New York.

Statistics:

  • $2.73 per share stock price decline on September 25, 2024
  • Over 12% stock price decline on September 25, 2024
  • $3.47 per share stock price decline on March 3, 2025
  • Over 25% stock price decline on March 3, 2025
  • $900 million recovered by Bleichmar Fonti & Auld LLP from Tesla, Inc.'s Board of Directors
  • $420 million recovered by Bleichmar Fonti & Auld LLP from Teva Pharmaceutical Ind. Ltd.
  • 2023 - year Labcorp Holdings Inc. spun off Fortrea Holdings Inc.

Sources:

  • GlobeNewswire, "Securities Law Firm Files Lawsuit Against Fortrea Holdings Inc." (July 19, 2025)
  • Bleichmar Fonti & Auld LLP, "Fortrea Securities Fraud Lawsuit" (July 19, 2025)
  • SEC, "Securities Exchange Act of 1934" (1934)
  • Jefferies, "Report: Fortrea's Cost Savings Not as Material as Thought" (September 25, 2024)
  • Fortrea Holdings Inc., "Q4 and Full Year 2024 Financial Results" (March 3, 2025)

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