What is the timeline for the lawsuit resolution and could it create near‑term volatility in the stock?

Resolution timeline

The Shareholders Foundation filing does not specify a court‑set deadline, but most securities‑class‑action suits move through a “claims‑making” phase that lasts 60‑90 days, followed by a period of discovery and possible settlement negotiations that can stretch 12‑18 months. In practice, a Neogen (NEOG) case that was filed in August 2025 is unlikely to be fully resolved before the late‑2025 to early‑2026 window. Until a settlement or a court‑issued decision is announced, the case will remain “open” and subject to periodic updates (e.g., claim‑submission extensions, mediation dates, or a scheduled trial).

Near‑term volatility impact

Because the suit targets investors who bought before Jan 2023—a cohort that still holds a sizable portion of the float—the market will treat the pending litigation as a short‑term catalyst. Anticipated volatility stems from two sources:

1. Legal‑news flow: Any new filing, deadline, or settlement‑talk (even a “no‑cause” dismissal) will trigger rapid price swings as retail and institutional holders adjust exposure. Expect a Bollinger‑band‑wide bounce or a 15‑20 % intraday swing around the dates of court‑docket releases or settlement‑negotiation updates.
2. Liquidity‑stress: The class‑action could prompt a modest wave of forced‑sale or “hold‑to‑settle” activity, especially if a settlement requires cash outlay. This can temporarily thin the order book, amplifying price moves on modest volume.

Trading implications

- Short‑term: Keep a tight‑‑‑stop or a defined risk band (≈2‑3 % of the current price) if you are long, as the upside can be eroded quickly on negative legal news. Conversely, a buy‑on‑dip if the stock breaks below a key support level (e.g., the 20‑day EMA) and the legal narrative stays neutral could capture a bounce when the market digests the news.
- Medium‑term: If the case drifts toward a settlement in late 2025/early 2026, the upside may be capped by the expected cash outlay. Position sizing should therefore be modest, with a view to exit before the settlement window or to roll the position into a defensive, lower‑volatility sector if the legal risk dominates the stock’s fundamentals.

In short, the lawsuit is unlikely to be resolved before Q4 2025 – Q1 2026, and the uncertainty will generate near‑term volatility that can be traded with tight risk controls and attention to legal‑filing dates.