The legal action, initiated by the firm Levi & Korsinsky, centers on claims that Nano-X repeatedly touted its proprietary MEMs X-ray chip production as a cornerstone of its commercial strategy. According to the complaint, these assurances masked a fundamental disconnect between internal manufacturing output and actual market demand for the company’s ARC systems.

Financial strain became public on April 20, 2026, when Nano-X shares plummeted 24.39% following the disclosure of a $33.4 million net loss for the fourth quarter of 2025. This downturn was largely driven by a $17.5 million asset impairment at the Korean facility, which the lawsuit claims wiped out previously reported capital investments. The firm alleges that management failed to disclose unsustainable cost structures and artificially inflated asset values on the balance sheet while simultaneously raising $15 million from investors in a November 2025 offering.

Joseph E. Levi, lead counsel for the firm, stated that the case hinges on the company's disclosure obligations within the medical imaging sector. The lawsuit contends that by failing to account for known impairment triggers and shifting to an outsourced production model, the company left shareholders to bear the cost of undisclosed manufacturing failures.