The complaint alleges that Cogent Communications overstated the demand for its optical wavelength services following the acquisition of Sprint’s wireline business. While the company touted a growing backlog of approximately 2,700 unique wavelengths as a primary engine for future revenue, the lawsuit contends that up to 90% of these orders were unlikely to convert into paying customers. These disclosures reportedly contributed to a share price decline of more than 80%, or roughly $69.00 per share.

Legal counsel Joseph E. Levi argues that the case centers on the company’s failure to disclose significant risks associated with the backlog, including long provisioning windows and incomplete network reconfiguration work. According to the filing, these factors rendered the reported demand projections illusory, misleading investors about the company’s growth trajectory. Eligible shareholders seeking to participate in the litigation or recover losses are encouraged to contact the firm before the court-imposed deadline.