The original class action was filed against defendants Synchronoss, its President, CEO and Chairman and its CFO and Treasurer. According to the complaint, defendants violated sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5, by issuing a series of material misrepresentations to the market during the Class Period. Synchronoss is a provider of on-demand multi-channel transaction software management platforms that enable communications service providers to automate new subscriber activation, order management and service provisioning.
The complaint alleges that during the Class Period, defendants made fraudulent material misrepresentations and omissions regarding Synchronoss's business and operations. Specifically, Synchronoss materially misrepresented the Company's financial condition and future prospects to the Company's shareholders and the investing public.
Synchronoss provides technology to AT&T, Inc. ("AT&T") that allows AT&T, as the exclusive United States service provider of the Apple iPhone, to "lock" Apple iPhones distributed to AT&T's wireless phone customers. The complaint alleges that during the Class Period, Defendants failed to disclose to investors numerous warning signs that the unlocking of iPhones jeopardized Synchronoss's iPhone
contract with AT&T.
While Apple iPhones were extensively being unlocked for use with other wireless carriers, Synchronoss continued to maintain that its future prospects for growth were positive. However, on June 9, 2008, AT&T announced Synchronoss would not be activating the iPhone 3G, which was released in July of 2008. Rather, the iPhone 3G is activated in-store, effectively removing Synchronoss from the transaction altogether. On this news, Synchronoss stock fell from $13.31 to $11.03, a 17.1% decline.
On December 30, 2008, the Court granted the motion to consolidate several cases, granted the motion to appoint Herman M. Braude and Richard Kerwick as lead plaintiffs and further granted the motion to appoint Gardy & Notis, LLP, Milberg LLP and The Rosen Law Firm, P.A. as lead counsel for the lead plaintiffs. On March 13, 2009, the lead plaintiffs filed a Consolidated Class Action Complaint. On April 24, 2009, the defendants responded by filing a motion to dismiss the Consolidated Class Action Complaint.
According to a press release dated April 09, 2010, Synchronoss Technologies, Inc. (NASDAQ: SNCR), the leading global provider of on-demand transaction management software platforms, announced that the U.S. District Court for the District of New Jersey has granted Synchronoss' motion to dismiss the purported consolidated securities class action complaint filed against Synchronoss and certain of its officers. The lawsuit had alleged violations of the Securities Exchange Act of 1934 primarily based on statements concerning the Company's financial and business prospects. In its Order dated April 7, 2010, the Court dismissed, without prejudice, all claims against all defendants. On August 4, 2010, the lead plaintiff filed a Stipulation of Dismissal, and the case was dismissed with prejudice on August 9, 2010.