According to the law firm press release, Nam Tai is an electronics design and manufacturing services provider to original equipment manufacturers (“OEMs”). The Company manufactures cell phones, palm-sized PCs, personal digital assistants, electronic dictionaries, calculators, digital camera accessories, components including liquid crystal display modules (“LCMs”) and panels, radio frequency modules, and flexible printed circuit subassemblies.
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (1) intense competition had forced the Company to lower its unit sales prices, thereby threatening the Company’s future profitability; (2) anticipated cancellation and fluctuation of orders by its key customers would cause it to halt capital investment into technology platforms; (3) Due to declining margins and volatility, the Company would have to halt its best quality LCM production operations services in both its Shenzhen and Wuxi manufacturing facilities in order to minimize further losses and preserve cash; and (4) as a result of the foregoing, the Company’s statements were materially false and misleading at all relevant times.
On April 29, 2013, the Company disclosed that customer orders for its liquid crystal display modules were much lower than originally anticipated. The Company noted that it relies on a very small number of customers forcing it to lower its prices to meet customers’ needs. Furthermore, the Company disclosed that it was considering halting its best quality LCM production operations service in both its Shenzhen and Wuxi manufacturing facilities by the end of June 2013 in order to minimize further losses and preserve cash. On this news, the Company’s shares declined $3.58 per share, or over 31.6%, to close at $7.75 per share on April 29, 2013.
On November 5, 2013, the motion was granted consolidating the cases; appointing the "Nam Tai Investor Group" as Lead Plaintiffs for the Class; and the law firm of Pomerantz Grossman Hufford Dahlstrom & Gross LLP was approved and appointed as Lead Counsel for the proposed Class.