Treace Medical Concepts, Inc. (TMCI) Securities Class Action Lawsuit Update [May 13, 2025]

Introduction

On April 28, 2025, a securities class action lawsuit was filed against Treace Medical Concepts, Inc. (TMCI) in the U.S. District Court for the Middle District of Florida. The Treace lawsuit alleges that the company and certain of its executives violated federal securities laws, including the Securities Exchange Act of 1934, by making false and misleading statements about the company’s financial outlook and demand for its surgical products. These misrepresentations allegedly inflated Treace Medical's stock price, causing significant investor losses when the truth emerged.  Investors who acquired Treace Medical securities between May 8, 2023 to May 7, 2024 (the "Class Period") might be eligible to join the class action lawsuit. 

Treace Medical Concepts is a medical device company. Treace Medical's primary product is the Lapiplasty 3D Bunion Correction system, which is used in orthopedic surgical procedures. 

In May 2023 and February 2024, Treace issued a press releases touting a substantial year-over-year revenue gains driven by increased surgeon uptake of Lapiplasty. During the associated earnings calls and at industry conferences, Treace executives downplayed the seriousness of Lapiplasty’s competition, asserting that the technology would maintain its marketplace dominance.  

In February 2024, Treace issued an optimistic 2024 guidance, expecting FY-24 revenue to be $220-225 million. 

But in May 2024, the Company issued dismal Q1-24 earnings and slashed its 2024 guidance. Treace claimed that Lapiplasty's competition impacted its market share, despite previous assurances otherwise.   

Treace’s common stock price crashed 63% after investors heard this news.   

Treace Medical Concepts, Inc. (TMCI) Lawsuit Case Details 

McCluney v. Treace Medical Concepts, Inc., et al  

Case No. 3:25-cv-00390 

U.S. District Court, Middle District of Florida 

Filed on April 28, 2025  

Treace Medical Concepts, Inc. (TMCI) Company Profile 

Treace Medical Concepts describes the Company's business as a “commercial-stage orthopaedic medical device company,” according to its website. One of its leading products is the Lapiplasty 3D Bunion Correction system. Treace’s website describes Lapiplasty as “a combination of instruments, implants, and surgical methods designed to correct all 3 planes of the bunion deformity and secure the unstable joint.” 

Class Period 

May 8, 2023 to May 7, 2024, inclusive. 

Investors who purchased Treace Medical securities during the class period might be eligible to join the Treace Medical Concepts, Inc. lawsuit.  

Allegations in the Treace Medical Concepts, Inc. (TMCI) Lawsuit

On May 8, 2023, Treace issued a press release reporting its Q1-23 financial results. The release boasted a 45% revenue increase year-over-year, driven by an increased number of Lapiplasty procedure kits sold “as a result of an expanded surgeon customer base and increased blended average selling prices.”   

During the associated earning call, the Company asserted it wasn’t seeing an impact from competition, claiming that despite there being other products on the market, Treace wasn’t seeing any “opposition to our momentum coming from these.” The Company reiterated those remarks at an August 16, 2023 medical summit, where it critiqued competitor products’ design. Treace executives said “we haven’t seen a technology that can match Lapiplasty at the surgeon/patient interface yet.”  

On February 27, 2024, Treace issued a issued a press release announcing its Q4-23 and FY-23 financial results and offering an initial guidance for 2024.  The Company reported Q4-23 revenue of $62.2 million and FY-23 revenue of $187.1 million, a 32% increase over 2022. The Company issued its 2024 guidance, expecting FY-24 revenue to be $220-225 million, and 18% to 20% growth over 2023.   

During the associated earnings call, Treace noted it added “a lot of surgeons” and utilization rates would increase. The Company again downplayed Lapiplasty’s competition. 

The Complaint filed against Treace Medical alleges that Treace and its executives issued materially false and misleading statements about the Company’s financial projections and surgical equipment demand, violating the Securities Exchange Act. The Complaint further alleges Treace Medical and its executives misrepresented its ability to achieve $220-225 million revenue in FY-24, creating an overly optimistic view of its growth potential.  These misstatements allegedly inflated Treace Medical's share price, causing investors to purchase shares at an artificially high price. 

The Truth Emerges 

On May 7, 2024, Treace issued a press release announcing its Q1-24 financial results and updating its FY-24 outlook. The Company reported $51.1 million quarterly revenue, a 21% increase year-over-year. The increase again was driven by higher volume of procedure kits and an expanded surgeon network. 

But, Treace shocked investors by pulling back its guidance. It now expected “full-year 2024 revenue of $201 million to $211 million, representing growth of 7% to 13%.” During the earnings call, the Company revealed fierce competition impacted the Company's revenue and accounted for the pullback. Company executives said, “it’s become clear that the market environment and competitive landscape is quickly evolving. . . .  we’re facing even more competition from knockoffs of our Lapiplasty products.”   

Further, the Company revealed increased surgeon uptake of “minimally invasive osteotomy” (MIS), a competitor product type. 

Market Reaction 

Investors reacted negatively to this news. Treace’s common stock price plummeted 63% overnight on unusually high trading volume. 

Next Steps 

• Submissions for lead plaintiff are due June 10, 2025. 

• The Court will issue its order for lead plaintiff and counsel in the weeks after submissions are due. 

• The Court will then consider motion for class certification. 

• The Court will later consider a Motion to Dismiss. 

To learn if you are eligible for recovery under the Treace securities class action lawsuit, visit the case submission page here.

Disclaimer: This shareholder alert is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for personalized guidance. No specific outcomes are guaranteed.