According to the law firm press release, Barrett Business Services provides a variety of business management solutions for small and medium-sized companies in the United States. The Complaint alleges that defendants made false and/or misleading statements and failed to disclose material adverse facts about the Company’s operations and financial performance and prospects. Specifically, the Complaint alleges that defendants made false and/or misleading statements and/or failed to disclose that: (1) the Company under accrued its self-insured workers’ compensation reserves; (2) as a result, the Company overstated its earnings; (3) the Company lacked adequate internal and financial controls; and (4), as a result of the foregoing, defendants’ statements were materially false and misleading at all relevant times.
On October 28, 2014, BBSI disclosed that it had a $37.8 million net loss for its 2014 fiscal third quarter. The Company attributed the loss to an $80 million pretax increase in workers’ compensation reserves, which effectively wiped out Barrett Business Services’ pretax earnings for the past five years. As a result of this news, the Company’s stock declined more than 58%, or $26.18 per share, to close at $18.28 per share on October 29, 2014, on unusually heavy volume.
A consolidated complaint was filed on April 29, 2015. This Complaint was amended on November 23. A second amended complaint was filed on March 21, 2016.
A Stipulation of Settlement was filed on October 28, 2016. The Settlement was preliminarily approved by the Court on November 7.