According to the law firm press release, ECOtality is an electric transportation and storage technologies company that sells electric vehicle (“EV”) supply equipment (or “EVSE”) through its customer-facing brand of smart EV chargers, Blink.
The complaint alleges that during the Class Period, defendants issued false and misleading statements regarding the Company’s business and future prospects. Specifically, the complaint alleges that defendants concealed the following material adverse facts from the investing public during the Class Period: (a) due to design and manufacturing defects, some of ECOtality’s charging systems had been causing overheating and even the melting of connector plugs when charging vehicles; (b) despite efforts undertaken to transition the Company’s business model from subsidizing installations of EVSEs under the Department of Energy’s (“DOE”) EV Project to regular commercial sales and installations, ECOtality was not achieving enough commercial sales and installations to sustain operations in the second half of 2013; (c) due to “unacceptable performance shortfalls during prototype verification testing,” ECOtality was not on track to meet the scheduled release of a new Minit Charger product for industrial customers in the second half of 2013; (d) due to would-be potential investors’ unwillingness to provide additionally needed financing, ECOtality was unable to obtain the requisite financing to meet its short-term and long-term capital needs and would be unable to meet its obligations to the DOE’s EV Project and the DOE would suspend all payments to the Company; and (e) due to non-compliance with the nation’s labor laws, the Company was liable to the U.S. Department of Labor for $855,000 for the payment of back wages and damages.
On August 12, 2013, before the opening of trading, ECOtality announced that the Company had hired a “restructuring” adviser to evaluate options, including new financing, a possible sale of the Company or bankruptcy filing. The Company’s Current Report filed with the SEC on Form 8-K that day emphasized, in pertinent part, that a bankruptcy filing could be made “in the very near future” following, among other things, disappointing sales and suspension of payments from the federal government. On this news, the price of ECOtality common stock, which had traded as high as $2.40 per share in intraday trading during the Class Period, plummeted more than 87% from that level to close at $0.30 per share when trading resumed on August 12, 2013.
On December 13, 2013, the Court issued an Order consolidating related actions, appointing lead plaintiff, and approving the selection of lead counsel.
On January 31, 2014, lead plaintiff filed a Consolidated Amended Complaint.
On September 16, 2014, the Court issued an Order granting Defendants' Motion to Dismiss. Plaintiffs were given leave to amend their complaint.