Archives: Cases

According to the Complaint, the Company made false and misleading statements to the market throughout the class period. Flex Pharma was overly optimistic regarding the approval chance and viability of FLX-787, its potential product for the treatment of ALS and CMT. This resulted in the Company making materially false and misleading public statements. When the market learned the true details about Flex Pharma, investors suffered damages.

According to the Complaint, the Company made false and misleading statements to the market throughout the class period. Unum was facing a higher incidence of claims in its long-term care business than it had historically. The Company also experienced unfavorable policy terminations in that business. Unum’s loss ratio in long-term care approached the upper 90% range. This resulted in the Company making materially false and misleading public statements. According to the lawsuit, when accurate information about Unum became apparent in the market, investors suffered damages.

According to the Complaint, the Company made false and misleading statements to the market. China Zenix’s trading actions in relation to the NYSE Continued Listing Requirements went against its public policy. The Company had inadequate controls over financial reporting. Based on these facts, the Company’s public comments were false and materially misleading throughout the class period. When the market learned the truth about China Zenix, investors suffered damages.

According to the Complaint, the Company made false and misleading statements to the market. FAT Brands’ overall sales growth had declined considerably. In particular, sales growth at Bonanza and Ponderosa restaurants were quite slower than what FAT Brands expected when it acquired the brands in early 2017. The fast-casual dining concept favored by the Company was facing saturation as well as pressure to keep customers from going to lower cost restaurants. At the same time, FAT Brands’ free cash flow was lower than the $5 million dividend obligations the Company faced. Based on these facts, the Company’s public statements were false and materially misleading at the time of the IPO. When the market learned the truth about FAT Brands, investors suffered damages.

According to the Complaint, Molina made false and misleading statements to the market throughout the class period. The Company failed to disclose that its administrative systems and internal infrastructure were not capable of handling its growth plans. It also failed to mitigate infrastructure flaws that caused critical errors in areas such as provider payments. As a result of these problems, Molina reported an earnings miss for the quarter ending March 31, 2016, also lowering its full-year 2016 guidance. Molina withdrew its 2017 earnings projection on August 2, 2017, the same day it reported a $230 million net loss for the quarter ending June 30, 2017. At the same time, the Company announced it would exit the ACA Health Exchange Marketplace. When the market learned the true details about Molina, investors suffered damages.

According to the Complaint, the Company made false and misleading statements to the market throughout the class period. Akers improperly recognized revenue for the year ending December 2017. Akers did not disclose the extent of the weakness of the Company’s internal controls over financial reporting. This resulted in the Company making materially false and misleading public statements. According to the lawsuit, when accurate information about Akers became apparent in the market, investors suffered damages.

According to the Complaint, the Company made false and misleading statements to the market throughout the class period. PG&E failed to maintain its electrical transmission and distribution networks to the standards required by safety regulations and state law. The Company’s electrical networks went on to cause multiple wildfires in California. Based on these facts, the Company’s statements about PG&E’s operations were materially false and misleading throughout the class period. When the market learned the truth about PG&E, investors suffered damages.

According to the Complaint, QUALCOMM made false and misleading statements to the marketplace. On January 29, 2018, QUALCOMM covertly filed a voluntary request with the Committee on Foreign Investment in the United States (“CFIUS”) to investigate the actions of Broadcom Limited, which was attempting to acquire QUALCOMM. The complaint alleges the Company made this request to block Broadcom’s takeover attempt. The market became aware of QUALCOMM’s secret activity on March 5, 2018, and the share price of QUALCOMM stock decreased substantially, damaging investors.

According to the Complaint, the Company made false and misleading statements to the market surrounding the IPO period. REV Group was unable to manage its backlog of vehicles despite claiming “strong visibility into future net sales.” The Company was also not able to operate its facilities efficiently and in a manner that would satisfy customer demand. As a result, the Company’s public statements were false and materially misleading throughout the IPO period. When the market learned the truth about REV Group, investors were damaged.

The investigation focuses on whether the Company issued false and/or misleading statements and/or failed to disclose information pertinent to investors. On May 31, 2018, the Wall Street Journal reported that the Federal Reserve has designated Deutsche Bank’s U.S. operations as being in a “trouble condition.” The Federal Reserve is concerned about “its controls around measuring financial exposure to clients and valuing collateral that backed loans[.]” The FDIC added Deutsche Bank’s FDIC-insured subsidiary, Deutsche Bank Trust Company Americas, to its list of at-risk “problem banks.” Once this news reached the marketplace, shares of Deutsche Bank fell over 4% on May 31, 2018.