According to the complaint, this securities fraud class action is brought on behalf of persons who purchased the publicly traded securities of Dana Corporation (“Dana” or the “Company”) between February 23, 2005 and October 7, 2005 (the “Class Period”). This case is brought against individuals each of whom served during the Class Period as a senior insider in Dana’s Heavy Vehicle Technologies and Systems Group (“Heavy Vehicle Group”) and/or its Commercial Vehicle System (“CVS”) division. This action arises out of a fraudulent scheme and wrongful course of business whereby defendants caused Dana to issue false financial statements for fiscal 2004 and the first two quarters of 2005.
By at least February 23, 2005 and continuing through the end of the Class Period on October 7, 2005, defendants fraudulently manipulated the reported earnings and financial performance of the Heavy Vehicle Group and its CVS division, which conduct was designed to and did cause Dana to issue false releases and file false reports with the Securities and Exchange Commission (“SEC”).
Defendants caused Dana to falsify its financial results during the Class Period by, among other things, utilizing sham transactions, creating and disseminating false invoices, failing to record steel surcharges and improperly recognizing revenue on price increases not agreed to by Dana’s customers. Defendants’ actions caused Dana to materially overstate the Company’s reported earnings by as much as 38% during the Class Period.
In September 2005, the price of Dana’s securities dropped precipitously as the truth about Dana’s actual operating performance began to reach the market. Thereafter, Dana admitted that its results for fiscal year 2004 (“FY04”), first quarter 2005 (“1Q05”) and second quarter 2005 (“2Q05”) had been falsified and that the quarterly profits defendants caused Dana to report during the Class Period had been overstated due to defendants’ misconduct.
On May 13, 2010, the Court issued an Order appointing Lead Plaintiff and Lead Counsel in this action.
According to an Order dated March 31, 2011, the defendants’ motions to dismiss were denied without prejudice as to the litigation of the applicability of the statute of limitations. However, the Court stated they may make a renewed motion for dismissal based on a more fully developed record at a later stage of these proceedings.
NOTE: Dana Corporation filed for Chapter 11 bankruptcy protection on March 3, 2006, and is not named as a defendant in the action.
On September 4, 2013, the Court issued an Order denying the Motion for class certification.
The parties stipulated to a voluntary dismissal on November 5, 2015.