According to the law firm press release, the complaint charges Walmart and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Walmart operates retail stores in various formats worldwide.
The complaint alleges defendants engaged in unlawful and unethical conduct. During the Class Period, defendants issued materially false and misleading statements regarding Walmart’s practices with respect to unlawful or unethical conduct. Specifically, the Company failed to disclose that its executives had been involved in a multi-million-dollar bribery scheme at Walmart’s Mexican subsidiary, Wal-Mart de Mexico (“Walmart Latin America”). As a result of defendants’ false statements, Walmart’s stock traded at artificially inflated prices during the Class Period, reaching a high of $62.48 per share on February 17, 2012.
On April 21, 2012, The New York Times published an article reporting that Walmart had “shut . . . down” an investigation concerning evidence that Walmart Latin America had engaged in “widespread bribery,” which included a paper trail of hundreds of suspect payments totaling more than $24 million. The article reported that top executives at Walmart and Walmart Latin America knew about but disregarded the bribery scheme.
As a result of this news, Walmart’s stock plummeted $2.91 per share to close at $59.54 per share on April 23, 2012, a decline of nearly 5% on volume of 38 million shares. The stock dropped again on April 24, 2012, to close at $57.77 per share on volume of 30 million shares, and on April 25, 2012, fell to $57.36 per share on volume of 28 million shares, as investors absorbed this shocking news.
Walmart is now the subject of a probe in Mexico by Mexican authorities and the subject of criminal and congressional investigations in the United States.
According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, included that the Company had violated the Foreign Corrupt Practices Act in connection with the bribery payments and that Walmart management did not address ethical concerns in a “timely and effective manner” as represented by defendants. As a result of defendants’ false statements, Walmart stock traded at artificially inflated levels during the Class Period. However, after the above revelations seeped into the market, the Company’s shares were hammered by massive sales, sending them down nearly 5% from their Class Period high.
On July 25, 2012, the Court Granted the Defendant’s Motion to transfer this action to the U.S. District Court for the Western District of Arkansas.
On December 11, 2012, the Court issued an Order appointing lead plaintiff and approving the selection of lead counsel.
On January 22, 2013, lead plaintiff filed Notice voluntarily dismissing this action as to an individual defendant.
On February 14, 2013, the lead plaintiff filed an amended complaint. Also on that date, lead plaintiff filed Notice voluntarily dismissing this action, without prejudice, as to certain individual defendants.
On February 24, 2014, the Court issued an Order denying defendants' Motion to Strike the Amended Complaint.
On September 26, 2014, the Court issued an Order denying defendants' Motion to Dismiss.
On September 20, 2016, the Court issued an Order granting Plaintiff's Motion for Class Certification.