According to the law firm press release, the complaint alleges that the Company operates in three reportable segments: Power, Renewable, and Industrial. Through Power, the Company provides the supply and aftermarket services for steam-generating and auxiliary equipment for power generation and other industrial applications. Through its Renewable segment, B&W supplies steam-generating systems, environmental, and auxiliary equipment for the waste-to-energy and biomass power generation industries. The Company's Industrial segment provides custom-engineered environmental solutions, industrial equipment, and aftermarket parts and services through Babcock & Wilcox MEGTEC Holdings, Inc., and provides custom-engineered comprehensive dry and wet cooling solutions and aftermarket services to the power generation industry, including natural gas-fired and renewable energy power plants, as well as downstream oil and gas, petrochemical, and other industrial end-markets through SPIG S.p.A., which B&W acquired on July 1, 2016.
On July 1, 2015, B&W began trading independently as a public company after spinning off from The Babcock & Wilcox Company by way of distribution of shares of B&W common stock to holders of the Company's former parent. The distribution of B&W common stock was made on June 30, 2015, and consisted of one share of B&W common stock for every two shares of the former parent's common stock as of the record date, June 18, 2015. Cash was paid in lieu of any fractional shares of B&W common stock.
The complaint alleges that throughout the Class Period, the Company was experiencing significant, undisclosed problems in its Renewable segment. Although defendants disclosed issues with a single project in the Renewable business on June 28, 2016, the complaint alleges they failed to disclose that similar problems were significantly and negatively impacting other projects in the Company's Renewable segment, instead assuring investors during a business update call that the problems were "a single project issue." In response to this partial disclosure, as well as lowered financial guidance for 2016, the price of B&W stock declined by 21% on June 28, 2016.
An amended Complaint was filed on September 28, 2017. Defendants filed a Motion to Dismiss the amended Complaint on November 13. On February 8, 2018, the Court issued an Order denying Defendants' Motion to Dismiss. On June 21, 2019, the parties entered into a Stipulation and Agreement of Settlement. The Court granted preliminary approval of the Settlement on August 12. The Court issued an amended Order preliminarily approving the Settlement on August 30.