What precedent do similar securities‑fraud cases have for settlement timelines and impact on shareholder value?

Precedent on settlement timing – Historically, securities‑fraud class actions against Nasdaq‑listed biotech firms follow a 12‑ to 24‑month timeline from filing to resolution. The “first‑to‑file” rule, discovery, and the need to obtain a confidential settlement package usually push the process to roughly one‑year, with many cases extending into a second year when parties negotiate a “settlement with prejudice” or a consent decree with the SEC. Examples include the 2022 Amgen‑Mylan fraud suit (settled after 18 months) and the 2020 Bluebird Bio case (resolved in 14 months). In most instances, the defendant company files a preliminary settlement notice within 6‑9 months, followed by a final approval by a court‑appointed judge and a claims administration period that can add another 3‑6 months. Consequently, investors should anticipate that any definitive cash or stock settlement for RxSight is unlikely before mid‑to‑late 2026, barrating an early “quick‑settle” agreement.

Impact on shareholder value – The market reaction to similar biotech fraud allegations has been fairly consistent: an immediate 10‑20 % price drop on the news, followed by a prolonged under‑performance relative to sector peers as legal risk premiums stay priced in. When settlements are finally announced, the direction of the price swing depends on the terms. Cash settlements that dilute existing equity (e.g., issuance of settlement shares) typically cause a further 5‑10 % dip at the announcement, while cash‑only settlements can trigger a modest rebound of 3‑7 %, reflecting the removal of litigation uncertainty. In cases where the company secures a no‑admission, no‑penalty settlement, the share price often stabilizes but remains below pre‑issue levels for months.

Trading implications – Given the likely 12‑18‑month settlement horizon, the prudent short‑term strategy is to reduce exposure to RXST now, especially if you hold a sizable position, as the stock is already trading at a discount reflecting the pending litigation risk. For opportunistic traders, a short‑term bearish play (e.g., buying puts or initiating a credit spread) could capture the continued downside while the case proceeds through discovery. Long‑term investors might consider adding on dips only after a clear settlement path emerges (e.g., a filed settlement notice) and the price stabilizes, as the eventual resolution—whether cash or diluted equity—will be priced in at that point. Monitoring SEC filings, court dockets, and any DJS Law Group press releases over the next 6‑9 months will be critical for timing any re‑entry.