According to the law firm press release, General Cable designs, develops, manufactures, markets, and distributes copper, aluminum, and fiber optic wire and cable products for the communications, electrical, and energy markets.
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) the Company understated cost of sales and overstated inventory balances; (2) the Company's reconciliation process was deficient as it failed to detect finished goods inventory; (3) the Company overstated inventory in its allocation of the purchase price among assets acquired, resulting in an understatement of goodwill; (4) the Company overstated its value added tax credits by at least $18 million; (5) the Company improperly recognized revenue of approximately $30 million and $7 million of gross margin in connection with "bill and hold" transactions for aerial transmission projects in Brazil; (6) the Company lacked adequate internal and financial controls; and (7) as a result of the foregoing, the Company's statements were materially false and misleading at all relevant times.
On October 15, 2013, the Company disclosed that due to certain accounting errors related to the Company's value added tax ("VAT") and revenue recognition in connection with historical "bill and hold" transactions for aerial transmission projects in Brazil, the Company's financial statements for fiscal years 2008 through 2012 and the interim periods during those years and the financial statements for the three fiscal months ended March 29, 2013 should no longer be relied upon. On this news, General Cable securities declined $1.63 per share or nearly 5%, to close at $32.24 per share on October 15, 2013.
On February 5, 2014, the Court issued an Order transferring this case to the United States District Court for the Eastern District of Kentucky for all further proceedings.
On March 12, 2014, the Court issued an Order appointing lead plaintiff and approving lead counsel. Lead Plaintiff filed a consolidated complaint on May 20.
On January 27, 2015, the Court issued an Order granting Defendants' motion to dismiss with prejudice.