According to the Complaint, Envivio, Inc. provides software-based internet protocol video processing and distribution solutions to mobile and broadband service providers, cable multiple system operators, and direct broadcast satellite service providers and content providers. Its solutions enable service providers and content providers to deliver linear broadcast and on-demand video services to their customers through multiple screens, such as tablets, mobile handsets, netbooks, laptops, personal computers, and televisions.

On or about April 25, 2012, Envivio filed its Prospectus for the IPO, which forms part of the April 24, 2012 Form S-l/A Registration Statement for the IPO, which became effective on April 24, 2012. At least 7,755,000 shares of Envivio common stock were sold to the public at $9 per share.

On August 13, 2012, Envivio issued a press release announcing preliminary revenue results for its fiscal 2012 second quarter. The Company reported that it expected revenues to be in the range of $10 million to $11 million versus its previous guidance of $17 million to $18 million for the quarter ending July 31, 2012.

On this news, Envivio's stock price dropped quickly, falling $3.22 per share to close at $2.48 per share on August 14, 2012, a one-day decline of more than 56%, on high volume.

Subsequently, on September 6, 2012, after the market closed, Envivio issued a press release announcing its results for its fiscal 2012 second quarter and disappointing guidance for its fiscal 2012 third quarter. The Company reported a net loss of $4.3 million or $0.16 earnings per share and revenue of $10.8 million for the second quarter. The Company further provided revenue guidance for its fiscal 2012 third quarter in the range of $10 to $11 million.

After releasing its fiscal 2012 third quarter results, Envivio hosted a conference call for analysts, media representatives and investors during which Defendants acknowledged that the Company had been experiencing a significant number of project delays with its existing customers, particularly in North America and Western Europe, which had been key growth areas for the Company. Defendants further admitted that the Company had also been experiencing a severe lengthening in its sales cycle for obtaining new business. While the Request for Proposal ("RFP") process, which Envivio engages into bid for and obtain new business, would traditionally take between 3 and 6 months to complete, the RFP process had slowed considerably and it was now taking between 6 and 12 months for a contract for a new project to be closed.

On this news, Envivio's stock price dropped again, falling to $2.15 per share on September 7, 2012, a one-day decline of more than 20%, on high volume.

On November 28, 2012, the Court issued an order consolidating cases. On October 11, 2013, the Court issued an order remanding the case to San Mateo County Superior Court.