The litigation, filed in the U.S. District Court for the Southern District of New York, centers on the period between September 5, 2024, and July 29, 2025. During this timeframe, iTonic shares plummeted from an intraday high of $32.00 to roughly $1.65. The complaint asserts that Pengfei Zhang, the brother of CEO Jianfei Zhang, held authority over SEC filings and public statements while the board failed to implement adequate risk assessment policies.

Plaintiffs contend that the company provided only generic warnings regarding microcap volatility while ignoring a coordinated promotional scheme involving false claims of a Gilead Sciences acquisition. Levi & Korsinsky, LLP, the firm representing the class, argues that individual directors bear responsibility for the accuracy of these disclosures. Investors who suffered financial losses have until September 29, 2026, to apply for lead plaintiff status. The case invokes Sections 10(b) and 20(a) of the Securities Exchange Act, seeking to hold controlling individuals accountable for the company’s alleged omissions.