Cogent Communications Faces Securities Lawsuit Over Wavelength Backlog

The legal challenge centers on whether Cogent misrepresented customer demand for its services. Plaintiffs claim the company touted an optical wavelength backlog that was largely illusory, with many listed customers either unable or unwilling to accept delivery. This discrepancy became evident when the company reported a 20% sequential decline in its backlog in February 2025, forcing the removal of 1,500 aging orders. Subsequent quarterly disclosures further eroded investor confidence as management admitted that installation capacity frequently outpaced actual demand.

By February 2026, the company abruptly stopped reporting backlog data altogether, a move that triggered another sharp decline in share price. Reed Kathrein, a partner at Hagens Berman Sobol Shapiro LLP, stated that the firm is investigating whether management intentionally promoted these metrics to create a false impression of company-centric demand. Investors seeking to participate as lead plaintiffs have until September 21, 2026, to file, while those with non-public information are being encouraged to explore whistleblower protections.