According to a press release dated September 03, 2010, the complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding Beckman’s business and financial results. Defendants engaged in improper behavior that harmed Beckman’s investors by failing to disclose the quality and compliance issues related to its troponin test kits. As a result of defendants’ false statements, Beckman’s stock traded at artificially inflated prices during the Class Period, reaching a high of $71.20 per share on September 14, 2009.
On July 22, 2010, Beckman reported its second quarter 2010 results, announcing that it had missed earnings estimates for the quarter and further that it was reducing its guidance due in substantial part to troponin quality and compliance issues. On this news, Beckman’s stock plummeted $12.64 per share to close at $47.26 per share on July 23, 2010, a one-day decline of 21% on volume of over 8.6 million shares.
The complaint alleges certain facts which defendants concealed during the Class Period, including: (a) Beckman failed to disclose that it had made certain modifications to its troponin test kit without seeking the appropriate product clearances from the Food and Drug Administration; (b) defendants failed to maintain proper controls related to product quality and regulatory compliance; (c) Beckman failed to disclose the adverse impact the troponin quality and compliance issues would have on its operations and financial results; and (d) Beckman’s revenue and earnings guidance for 2010 was misstated and lacked a reasonable basis.
As a result of defendants’ false statements and omissions, Beckman’s common stock traded at artificially inflated prices during the Class Period. However, after the above revelations seeped into the market, Beckman’s shares were hammered by massive sales, sending them down nearly 34% from their Class Period high.
On December 8, 2010, Judge Josephine Staton Tucker consolidated two related actions into case number SA CV 10-01327-JST (RNBx), and approved the Arkansas Teacher Retirement System and the Iron Workers District Counsel of New England Pension Fund as lead plaintiffs. Further, Labaton Sucharow and Berger Montague were appointed as co-lead counsel, and Motley Rice was appointed as liaison counsel. The plaintiffs filed a Consolidated Class Action Complaint on February 7, 2011. The defendants filed a motion to dismiss on April 22, 2011.
According to a news article dated September 19, 2011, a class of Beckman Coulter Inc. shareholders on Friday asked a California federal judge to approve a $5.5 million settlement that would resolve claims that the lab equipment maker didn't timely disclose regulatory and product quality issues, hurting the company's stock price. The parties agreed to the settlement Sept. 13, according to papers filed in the Southern District of California.