Case Page

 

Case Status:    ONGOING    
On or around 10/13/2017 (Ongoing date of last review)

Filing Date: October 21, 2016

According to the law firm press release, the Complaint alleges that during the Class Period, Defendants violated provisions of the Exchange Act by issuing false and misleading statements regarding the profitability and growth prospects of an important software product called Health Enterprise—designed to assist state agencies administer their respective Medicaid programs. Xerox is a global provider of document processing services and printing machines. Beginning in 2009, as the Company’s hardware products became less profitable, Xerox embarked on a new corporate strategy to transition into more of a computer services-related company. As part of Xerox’s computer services transition strategy, the Company acquired Affiliated Computer Services, Inc. for $6.4 billion in February 2010. Through the acquisition, Xerox took over the Health Enterprise product, which provides software solutions for states to manage all aspects of their contemporary Medicaid programs and to do so in accordance with government rules and regulations.

During the Class Period, Xerox repeatedly touted the Health Enterprise business as an important growth area for the Company, which would operate at low cost and high profit margin. However, Defendants’ Class Period statements pertaining to the profitability and growth prospects of the Health Enterprise business were materially false and misleading because Defendants failed to disclose that: (1) the Company’s existing Health Enterprise projects were experiencing major delays and cost overruns; (2) the Company would be unable to deliver Health Enterprise implementations at sustainable profits; and (3) as a result, the Company’s positive statements about its business, operations, and prospects lacked a reasonable basis.

Beginning in late 2014, this truth began to be revealed in a series of disclosures that exposed implementation delays, cost overruns, and customer disputes. Finally, in October 2015, two key state agencies terminated Health Enterprise contracts with Xerox. By then, Xerox had taken more than $500 million in related asset write-downs. In reaction to these revelations, Xerox’s stock lost hundreds of millions of dollars in market capitalization, with the Company’s stock price falling from a Class Period closing high of $13.57 per share on December 5, 2014, to close at $9.01 per share on October 27, 2015.

On February 28, 2017, the Court appointed Lead Plaintiffs and Counsel. Lead Plaintiff filed an amended complaint on May 1, 2017.

COMPANY INFORMATION:

Sector: Technology
Industry: Computer Services
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: XRX
Company Market: New York SE
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: S.D. New York
DOCKET #: 16-CV-08260
JUDGE: Hon. Paul A. Engelmayer
DATE FILED: 10/21/2016
CLASS PERIOD START: 04/23/2012
CLASS PERIOD END: 10/23/2015
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Labaton Sucharow LLP
    140 Broadway, Labaton Sucharow LLP, NY 10005
    212.907.0700 212.818.0477 · info@labaton.com
No Document Title Filing Date
COURT: S.D. New York
DOCKET #: 16-CV-08260
JUDGE: Hon. Paul A. Engelmayer
DATE FILED: 05/01/2017
CLASS PERIOD START: 04/23/2012
CLASS PERIOD END: 10/27/2015
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Kessler Topaz Meltzer & Check LLP (Pennsylvania)
    280 King of Prussia Road, Kessler Topaz Meltzer & Check LLP (Pennsylvania), PA 19087
    610.667.7706 610.667.7706 · info@ktmc.com
  2. Labaton Sucharow LLP
    140 Broadway, Labaton Sucharow LLP, NY 10005
    212.907.0700 212.818.0477 · info@labaton.com
No Document Title Filing Date