According to the law firm press release, the complaint charges GMCR and certain of its officers and directors with violations of the Securities Exchange Act of 1934. GMCR describes itself as a leader in the specialty coffee and coffee maker businesses.
The complaint alleges that, during the Class Period, defendants issued materially false and misleading statements regarding the Company’s growth and demand for its products. Specifically, defendants misrepresented and/or failed to disclose the following adverse facts: (i) that demand for the Company’s brewers and portion packs had slowed; (ii) that the Company’s models for predicting consumer demand were flawed and ineffective; and (iii) as a result of the foregoing, Defendants lacked a reasonable basis for their positive statements about the Company and its prospects.
On May 2, 2012, after the close of regular market trading, GMCR issued a press release announcing its financial performance for the second quarter of fiscal 2012, which fell short of its prior guidance and also revised downward the Company’s guidance for the full fiscal year 2012. Following this announcement, on the next day of trading, May 3, 2012, shares of GMCR stock basically halved themselves – tumbling $23.65 per share, or 48%, to close at $25.87 per share from the prior day’s close of $49.52 per share.
On July 31, 2012, the plaintiffs’ motion to appoint lead plaintiff as class representative, and appoint class counsel was granted.
On September 26, 2013, the Court issued an Order granting the Motions to Dismiss without prejudice. Plaintiffs were given leave to file an amended complaint. Plaintiffs filed a Notice appealing this Order to the Court of Appeals on October 18. On July 8, 2014, the Court of Appeals issued a Mandate affirming the decision of the District Court.