Neogen Lawsuit: 3M Merger Claims, Disclosures, and Status

The Neogen lawsuit is a federal securities class action accusing the food and animal safety testing company, along with two former top executives, of misleading investors about the troubled integration of 3M’s Food Safety Division. The case was filed in July 2025 in the U.S. District Court for the Western District of Michigan, and a motion to dismiss is now fully briefed and awaiting a ruling.¹

What Investors Are Alleging

The case is captioned Operating Engineers Construction Industry and Miscellaneous Pension Fund v. Neogen Corporation, et al., Case No. 1:25-cv-00802, filed July 18, 2025 and assigned to Judge Hala Yalda Jarbou.²³

The complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, the federal anti-fraud provisions that apply to publicly traded companies. The class period runs from January 5, 2023, through June 3, 2025.¹ Beyond the company itself, the suit names two individual defendants: former CEO John Adent and former COO and CFO David Naemura.⁴

According to the complaint, these executives repeatedly told investors on earnings calls and in SEC filings that the 3M integration was proceeding “as planned” or “on track,” while internally the company was contending with dysfunctional IT systems, shipping backlogs, and eroding margins.⁵ An amended complaint filed in January 2026 called the integration a “colossal failure” and cited testimony from seven former Neogen employees.⁶

The 3M Integration Behind the Claims

Neogen announced in December 2021 that it would combine with 3M’s Food Safety Division in a tax-free Reverse Morris Trust deal. The transaction closed on September 1, 2022, leaving legacy Neogen shareholders with roughly 49.9% of the combined company. The deal was financed in part by about $1 billion in debt-funded cash paid to 3M.⁷

The amended complaint alleges that 3M deprioritized shipments of Food Safety Division products after the deal was announced, causing margin erosion and supply shortfalls. Neogen’s attempt to deploy its own SAP enterprise resource planning system in January 2024 was described by former employees cited in the complaint as a “disaster” that prevented order fulfillment and shipping. The company allegedly had to resort to manual product assembly and took significant inventory write-offs.⁶

The Disclosures That Triggered the Stock Drops

The suit points to three company announcements that allegedly revealed the truth and sent shares sharply lower.

On January 10, 2025, Neogen disclosed a $461 million non-cash goodwill impairment charge tied to the 3M acquisition, cut its fiscal 2025 revenue and EBITDA guidance, and admitted material weaknesses in its internal controls over financial reporting. The stock fell roughly 5% to $12.36.⁸

On April 9, 2025, Neogen reported quarterly revenue of $221 million, missing estimates and reflecting a 3.4% year-over-year decline. The company again lowered fiscal 2025 guidance and announced that CEO John Adent would step down. Shares plunged 28% to $5.02.⁹⁸

On June 4, 2025, the company projected that its EBITDA margin had dropped to the “high-teens,” down from 22% the prior quarter. The stock slid another 17% to close at $4.96.⁸

From a class-period high of $23.84 in August 2023 to that $4.96 close, Neogen’s stock lost roughly 79% of its value, erasing more than $4 billion in market capitalization according to the complaint.⁵ The amended complaint also cites events after the class period, including a $600 million goodwill write-down on July 29, 2025, as further evidence that the problems ran deeper than what investors had been told.⁶

Where the Case Stands

On December 3, 2025, the court appointed a group of institutional investors as lead plaintiffs. The group includes the Operating Engineers Construction Industry and Miscellaneous Pension Fund, the City of Miami Fire Fighters’ and Police Officers’ Retirement Trust, the Metropolitan Employee Benefit System, several City of Orlando pension funds, and the West Palm Beach Firefighters’ Pension Fund. Saxena White P.A. was named co-lead counsel.¹

The lead plaintiffs filed their amended complaint on January 20, 2026. Neogen’s defense team moved to dismiss on February 10, 2026; plaintiffs filed their opposition on March 10, and the defendants replied on March 24. As of mid-2026, the motion to dismiss is fully briefed and pending, so a ruling could come at any time. The specific arguments in the motion have not been made public through the available sources.¹

Executive Departures

Both individual defendants have left the company. Adent’s departure was announced on April 9, 2025, with the board stating it had “determined that now is the right time to begin a leadership transition.” He stayed on until a successor was named and then moved into a Special Advisor role through October 31, 2025.¹⁰ CFO David Naemura, the other individual defendant, resigned on September 15, 2025.⁶ COO Doug Jones left in March 2025, in what the company characterized as a retirement.¹¹ Mike Nassif was appointed CEO and President effective August 11, 2025,¹² and at a January 2026 investor conference he acknowledged the company was still “in the early stages of the turnaround.”

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Saxena White P.A. Neogen Corporation
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Saxena White P.A. Original Complaint, Operating Engineers v. Neogen Corp.
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ZLK. Neogen Corporation Securities Class Action Lawsuit Update
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Saxena White P.A. Amended Class Action Complaint, Operating Engineers v. Neogen Corp.
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Neogen Corporation Investors. Neogen Completes 3M Food Safety Business Merger
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ZLK. Neogen Corporation Securities Class Action Lawsuit Alert
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Investing.com. Neogen Shares Plunge Over 16% as Q3 Revenue Misses Estimates, Guidance Cut
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Stock Insights. Neogen Management Changes
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Neogen Corporation Investors. Neogen Announces CEO Transition
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Neogen Corporation Investors. Neogen Corporation Announces Appointment of Mike Nassif as CEO and President