According to a law firm press release dated June 12, 2008 a class action has been commenced on behalf of an institutional investor on behalf of U.S. citizens who purchased the publicly traded stock of European Aeronautic Defence & Space Co. ("EADS" or the "Company") on the Frankfurt (Frankfurt: EAD.F), Madrid (Mercado Continuo: EAD.MC) and/or Paris (Paris: EAD.PA) stock exchanges. The Company produces commercial aircraft, including the various Airbus models, military fighter aircraft, military and commercial helicopters, missiles, satellites, and telecommunications and defense systems.
The Complaint charges EADS and certain of its officers and directors with violations of the Exchange Act. The Complaint alleges that throughout the Class Period, EADS falsely assured the investing public that it would overcome the technical problems in the production of the Company's Airbus A380 commercial jets ("A380") and it would be able to meet its year-end delivery deadlines. Moreover, the Company issued numerous positive statements which described the Company's increasing financial performance.
According to the Complaint, these statements were materially false and misleading because they failed to disclose and misrepresented the following adverse facts, among others: (i) that the Company was experiencing insurmountable delays in the manufacture of the A380 commercial jet; (ii) that the Company would be required to
compensate its customers for these delays through discounts and certain customers would likely be canceling their entire orders; and (iii) that, as a result of the foregoing, the Company's ability to receive new contract awards from commercial airliners and its ability to reap future revenues at the levels that it was projecting would be in serious doubt.
On June 13, 2006, the Company announced that its Airbus subsidiary was having production problems with the A380 commercial jet, which would cause a significant delay in delivery to its customers. EADS also issued a profit warning beyond 2006 which was attributable to these delays and announced that it anticipated annual shortfalls of EUR 500 million, without taking into account possible contract terminations from existing customers.
Upon this announcement, shares of EADS fell EUR 6.69 per share, or 26%, to close at EUR 18.73 per share, on unusually heavy trading volume.
On August 8, 2008, the Plaintiffs filed an Amended Class Action Complaint. On September 18, 2008, several actions were consolidated under Master File Civil Action No. 08-cv-05389 (JES). Bristol County Retirement System was appointed lead Plaintiff and Labaton Sucharow LLP and Coughlin Stoia Geller Rudman & Robins LLP were approved as lead Counsel for the Class.
On November 3, 2008, Plaintiffs filed a Second Amended Class Action Complaint. The Defendants responded by filing motions to dismiss the Second Amended Complaint.
On March 26, 2010, in a memorandum and order, the Court set forth that the Plaintiffs' causes of action against the Defendants were understandable and that the Plaintiffs’ sought the robust protections of federal securities laws in a United States court. But, a court of limited jurisdiction lacks the authority to hear every grievance that arises overseas. For that reason the Court dismissed the case for lack of standing and subject matter jurisdiction.
Judgment was entered on March 31, 2010. On April 23, the Plaintiff filed Notice of Appeal. The appeal was voluntarily dismissed on August 27, 2010.
