Dexcom Leaders Sold Stock on Inside Sales Knowledge, Suit Says

Dexcom Inc.‘s board and two executives overstated the glucose monitor maker’s growth potential—and five of them sold shares for a total of $26 million in profits—before a 41% stock drop on disappointing sales, an investor alleges.

The directors and officers’ misconduct harmed Dexcom in several ways, Jerome Malone says in a shareholder derivative suit docketed Tuesday in the US District Court for the Southern District of California. For example, the company paid the leaders “lavish compensation,” incurred costs for an internal investigation and professional fees, and faces a proposed class action over the July 26 stock drop, Malone says. ...