Plaintiff's law firm issued a press release on September 4, 2018, announcing the lawsuit. According to the press release, Philip Morris is one of the largest and most recognizable cigarette and tobacco manufacturing companies in the world. The Company’s subsidiaries and affiliates and their licensees are engaged in the manufacture and sale of cigarettes and other nicotine-containing products in markets outside of the United States.
The Complaint alleges that during the Class Period, Defendants made false and misleading statements and/or failed to disclose adverse information regarding the Company’s business and prospects, including that Philip Morris was experiencing a faster decline in overall cigarette and e-cigarette (or “heated tobacco”) sales volumes during the first quarter of 2018 than investors had been led to believe, that its much-lauded sales initiatives had stalled, and that it was experiencing adverse sales headwinds in key markets. As a result of these alleged misrepresentations, Philip Morris stock traded at artificially inflated prices during the Class Period, reaching a high of $109 per share.
Then, on April 19, 2018, Philip Morris issued a press release announcing disappointing results for the Company’s first quarter of 2018. Against its easiest prior-year comparison, the Company reported that combined cigarette and heated tobacco unit shipment volume had declined by 2.3% during the quarter. The Company also stated that key sales initiatives had stalled, as the Company’s heated tobacco unit growth had plateaued due to market demographics and faltering consumer conversion tactics and, further, that cigarette shipments had fallen by 5.3% during the quarter, signaling persistent adverse trends in the business. On this news, the price of Philip Morris stock declined $15.80 per share, or more than 15%, to close at $85.64 per share on April 19, 2018.
Plaintiff seeks to recover damages on behalf of all purchasers of Philip Morris common stock during the Class Period (the “Class”).
On February 25, 2019, the Court issued an Order consolidating cases and appointing Co-Lead Plaintiffs and Co-Lead Counsel. Lead Plaintiffs filed a consolidated amended Complaint on May 10. Defendants filed a Motion to Dismiss the consolidated amended Complaint on July 12. On February 4, 2020, the Court issued an Order dismissing the claims with prejudice, with the exception of Plaintiffs' claims with respect to four undisclosed studies. Lead Plaintiffs filed a second consolidated amended Complaint on September 28.