According to the law firm press release, Fusion-io is a computer hardware and software systems company that designs and manufactures memory storage solutions using flash memory technology. Since the Company's initial public offering in 2011, a limited number of what the Company calls "strategic" customers have accounted for a significant portion of the Company's revenues.
As alleged in the Complaint, Defendants misrepresented to investors that the Company was a market leader in large-scale flash memory applications and was not facing any competitive pressure or risk from the commoditization of flash memory products. Defendants also issued positive revenue guidance and misrepresented that the Company was able to anticipate the demand from its strategic customers based on its years of experience as their flash memory supplier. As a result of Defendants' false statements and omissions, Fusion-io's securities traded at artificially inflated prices during the Class Period. After the market closed on October 23, 2013, the Company revoked its prior revenue guidance and announced that its expected gross margin in 2014 would fall significantly, indicating that the competitive pressures facing Fusion-io were more significant than Defendants had represented. That disclosure caused a material decline in the price of Fusion-io stock.
On June 10, 2014, the Court issued an Order consolidating cases, appointing lead plaintiff, and approving lead counsel. Lead Plaintiffs filed a Consolidated Complaint on August 6.