Lawsuit Alleges Systematic Overbilling and “Zombie” Revenue Scheme; Stock Delisted Following Federal Fraud Indictments and Chapter 11 Filing
SAN FRANCISCO, March 5, 2026 /PRNewswire/ — National shareholder rights law firm Hagens Berman is notifying investors that a securities class action lawsuit has been filed against the former top executives of Zynex, Inc., whose common stock traded on the NASDAQ exchange under the symbol “ZYXI” prior to its suspension on Dec. 24, 2025 and subsequently traded over the counter as “ZYXIQ.”
The lawsuit, captioned Beidel v. Thomas Sandgaard, et al., No. 1:26-cv-00714, was filed in the U.S. District Court for the District of Colorado. The action seeks to recover losses for all persons and entities who purchased or otherwise acquired Zynex securities during the Class Period: February 25, 2021, through December 15, 2025, inclusive.
The firm urges Zynex investors who suffered significant losses to contact the firm now to discuss their rights.
The litigation alleges that Zynex misled investors for years by reporting “record growth” that was allegedly fueled by a fraudulent scheme to ship medically unnecessary supplies, such as excessive electrode pairs, to unsuspecting patients. This practice, often referred to as an “oversupplying scheme,” eventually led to a massive $85 million forfeiture to the Tricare military health program and criminal charges against the company’s former leadership.
Zynex investors are encouraged to visit the Hagens Berman Zynex case page to download a copy of the complaint and review the lead plaintiff process: www.hbsslaw.com/cases/zynex
“The complaint alleges that Zynex’s revenue was not organic growth, but rather the result of predatory billing practices that management continued even after being warned by major insurers. The $1.2 billion in claims they once touted has now culminated in bankruptcy and federal indictments.” said Reed Kathrein, the Hagens Berman partner leading the firm’s investigation of the claims in the pending suit.
Summary of Allegations: The “Oversupplying” Scheme
The filed complaint alleges that Zynex’s executives violated federal securities laws.
- Systemic Overbilling: The lawsuit alleges Zynex routinely shipped patients up to 128 electrode pairs per month, far exceeding medical necessity, specifically to inflate billings to government and private payors.
- Tricare Suspension & Forfeiture: In March 2025, Zynex revealed that Tricare—representing 25% of its revenue—had suspended payments. It was later revealed that Zynex agreed to forfeit over $85 million in billings to resolve these fraud allegations.
- Criminal Indictments: On January 21, 2026, former CEO Thomas Sandgaard and former COO Anna Lucsok were indicted for health care and securities fraud, leading to their immediate removal from the company.
- Chapter 11 & Delisting: As the fraud came to light, Zynex was forced to file for bankruptcy and was subsequently delisted from the Nasdaq, with its stock price (now ZYXIQ) suffering a near-total loss of value for common equity holders.
Critical Deadline: April 21, 2026
If you purchased Zynex common stock during the Class Period (February 25, 2021 – December 15, 2025), you have until April 21, 2026, to ask the Court to appoint you as Lead Plaintiff.
- SUBMIT YOUR ZYNEX INVESTMENT LOSSES NOW
- Contact: Reed Kathrein at 844-916-0895 or email ZYXI@hbsslaw.com
If you’d like more information and answers to frequently asked questions about the firm’s Zynex investigation, read more »
Whistleblowers: Persons with non-public information regarding Zynex should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email ZYXI@hbsslaw.com.
About Hagens Berman
Hagens Berman is a global plaintiffs’ rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman’s team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.
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SOURCE Hagens Berman Sobol Shapiro LLP
