There were no new activist reports this past week. However, The Bear Cave would like to draw attention to Fulgent Genetics (NASDAQ: FLGT — $1.15 billion), a genetic testing company that pivoted to coronavirus test kits. In January 2021, The Bear Cave published on the company and wrote, “a series of related party transactions raise concerns about whether the company is being run in the best interest of shareholders.” At the time, The Bear Cave noted that multiple executives were transferring stock into blind trusts and Fulgent had purchased furniture from a company owned by the CEO’s wife.

On Friday, Leonard Post, a board member and Chair of the Governance Committee, resigned after just three months. In addition, John Bolger, Chair of the company’s Audit Committee, resigned in September after six years. The company disclosed that Mr. Bolger’s “decision to resign was not due to any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.” That sentence is omitted from the company’s disclosure about Mr. Post’s resignation this week.

Last quarter, Fulgent disclosed it “became aware that the SEC is conducting a non-public investigation when we received a subpoena requesting information regarding certain of our Exchange Act reports for 2018 through the first quarter of 2020.” In addition, Fulgent “received a [Civil Investigative Demand] issued by the U.S. Department of Justice pursuant to the False Claims Act related to its investigation of allegations of medically unnecessary laboratory testing, improper billing for laboratory testing, and remuneration received or provided in violation of the Anti-Kickback Statute and the Stark Law.”

Today, Fulgent Genetics has only three board members. One is Michael Nohaile, who joined in August. Another is Linda Marsh, a Senior Executive Vice President of AHMC Healthcare, a for-profit hospital that does business with Fulgent. The third is Ming Hsieh, the company’s founder and CEO.