According to a law firm press release, the complaint charges NextWave and certain of its officers and directors with violations of the Securities Exchange Act of 1934.
NextWave is a mobile broadband and multimedia technology company that develops, produces and markets mobile multimedia and wireless broadband products.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and financial results. As a result of defendants' false statements, NextWave stock traded at artificially inflated prices during the Class Period, reaching as high as $10.10 per share in June 2007.
On August 7, 2008, after the market closed, Nextwave issued its second quarter 2008 financial results, announcing it only had $71.1 million in cash and similar instruments available as of June 30, 2008 and, unless it raised money, its cash would run out at the beginning of October 2008. As a result, the Company was seeking financing that would give the Company enough money to operate through June 2009. On this news, NextWave's stock fell $1.90 per share to close at $0.95 per share, a one-day decline of 67%.
According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows: (a) NextWave did not have adequate sources of liquidity to continue operations as it executed its growth strategy and continued making aggressive worldwide acquisitions; (b) defendants had no reasonable basis to make favorable statements that the Company's WiMAX semiconductor products would be available for
commercial sale in the first half of 2008; (c) NextWave's growth and acquisition strategy was not financially successful and did not provide the basis for continued growth or financial success because it was straining NextWave's fragile liquidity position and NextWave did not have the financial resources to continue to operate its world-wide operations through the end of 2008; (d) NextWave failed to timely
disclose that it had invested all of its marketable securities in extremely high-risk and illiquid auction rate securities; and (e) NextWave's ability to continue as a going concern was seriously in question by reason of the facts alleged in subparagraphs (a)-(d) above.
On February 24, 2009, an Order Consolidating Related Actions, Appointing Lead Plaintiff, and Approving Counsel was granted by the court.
On May 15, 2009, an Consolidated Amended Complaint For Violation Of The Federal Securities Laws was filed with the court.
On March 05, 2010, the Court issued an order granting Defendants' Motion to Dismiss without prejudice and allowed Plaintiff to file an amended complaint within 21 calendar days of the date the order.
On March 26, 2010, a second amended consolidated complaint for violation of the federal securities laws was filed by the plaintiffs against the defendants in this action.
According to a Order Granting Defendant’s Motion To Dismiss Without Prejudice dated, March 15, 2011, the Court directed the Plaintiff, again, to amend its complaint within 21 days to better state a claim. The Plaintiff must allege generally what it believes NextWave misrepresented, then identify specific statements that manifest this misrepresentation, and then identify specific confidential witness allegations that substantiate the allegations of falsity and scienter.
The plaintiff filed a Third Amended Consolidated Complaint on May 5, 2011.
On November 21, 2011, the Court issued an Order granting defendants' motion to dismiss plaintiff's Third Amended Consolidated Complaint with prejudice.
On July 25, 2012, the Court issued an Order granting the motion for preliminary approval of the settlement.
On November 9, 2012, the Court issued an Order awarding attorneys' fees and expenses. The Court also issued an Order and Final Judgment of Dismissal with prejudice.