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Stock Losses

The Southern Company's Kemper Project

The Southern Company undertook to build a “clean coal” plant in Kemper County, Mississippi that would turn lignite coal into a synthetic gas to be used to power the plant. For a number of reasons, it was important that the plant be completed on time, and the complaint for this securities class action claims that the company repeatedly lied about its ability to meet the deadline, in violation of the Securities Exchange Act of 1934.

Qualcomm Building

In order for devices to interact with each other, they must use common standards. But the choosing of a standard could give its owners excessive anti-competitive power. The complaint for this class action claims that Qualcomm promised to license its technology to all on an equal basis, but that it actually used its position to “suppress competition, drive its rivals out of business, and extract supra-competitive royalties.” Its statements to the contrary, the complaint says, were false or misleading, in violation of the Securities Exchange Act of 1934. 

Bottle of HP Acthar Gel

Are revenues sustainable when a pharmaceutical company increases the price of a drug 85,000%? The complaint for this securities class action claims that they are not if the company is relying on anti-competitive behavior and on Medicare and Medicaid to make they payments. Mallinckrodt PLC’s statements concealing anti-competitive acts and downplaying its reliance on government entities for purchases of its very expensive drug, the complaint says, were violations of the Securities Exchange Act of 1934. 

Banc of California Branch

One of the defendants in this case, Steven Sugarman, co-authored a book called Don’t Get Fooled Again by Corporate Fraud. Ironically, the complaint for this class action uses quotations from this book to introduce its sections, as it sets out relationships between Banc of California officials like Sugarman and ties to “convicted fraudster” Jason Galanis. At issue are Banc’s public statements on these connections, which the complaint calls “false and misleading” and violations of the Securities Exchange Act of 1934. In the end, Banc admitted that it had had insufficient internal controls over disclosures and that the SEC had launched an investigation. 

Yahoo Building and Flag

You might think that a company that lives online to the extent that Yahoo does would have excellent security. But you would be wrong, says this securities class action. The complaint claims that Yahoo used inadequate security measures and failed to disclose data breaches that were some of the largest ever. These failures to disclose the truth, says the complaint, are violations of the Securities Exchange Act of 1934, and they led to stock losses and investigations by regulatory authorities.

Cemex Logo

Cemex claimed in its public statements that it had strict anti-bribery policies. But the complaint for this securities class action claims that those statements were violations of the Securities Exchange Act of 1934, because the company has since discovered that certain of its executives may have paid bribes in a land deal in Colombia. Announcements that the Colombian attorney general, the US SEC, and the US Department of Justice were investigating further caused falls in the company’s ADR prices.

Acadia Facility in California

Acadia Healthcare Company, Inc. touted its “competitive strength” in “quality” in the British mental healthcare market, but according to the complaint for this securities class action, those advantages were an illusion. The complaint claims that the company’s statements about its UK operations and its guidance for 2017 were false or misleading, violating both the Securities Act of 1933 and the Securities Exchange Act of 1934.

BRF Logo

This securities class action is the second recent case alleging that a Brazilian meatpacking company bribed officials to cover up unsanitary conditions at its facilities. Eventually, a two-year investigation and a raid by the Brazilian federal police uncovered the bribery of inspectors and politicians, the use of rotten meat, traces of salmonella, and, finally, evidence that the company’s officials knew about it all. Because it’s a securities class action, the complaint’s central assertion is that the company concealed these activities from investors, in violation of the Securities Exchange Act of 1934.

Innocoll Collagen Matrix

Is the Innocoll Public Holdings sponge containing a local anesthetic a drug or a medical device? The complaint for this class action claims that the company tried to test it as a drug only, claiming that it had discussed the pathway to approval with the Food and Drug Administration (FDA), when it was actually a drug/device combination. Unfortunately, the complaint says that this, and the failure to disclose that its testing was inadequate, were violations of the Securities Exchange Act of 1934. 

Wall Full of Vista Outdoor Gear

The complaint for this securities class action claims that Vista Outdoor, Inc. kept its stock at inflated prices by making false or misleading statements, overstating its financial results, and failing to disclose material facts about its business. For example, it says, the company did not disclose high channel inventories, lack of demand, lack of new product development, continual changes in key management positions, and deteriorating market conditions. Other factors included retailer bankruptcies, softening demand, industry consolidation, and a warm hunting season for the second year in a row. The complaint claims that the company’s optimistic public statements were therefore were violations of the Securities Exchange Act of 1934. 

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