According to the Complaint, in April 2017, Hewlett Packard Enterprise Company ("HPE") conducted a Merger by spinning off its Enterprise Services segment, merging it with CSC, and forming the company now known as DXC. DXC is a technology company that provides end-to-end information technology services.
The Complaint alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, the Complaint alleges Defendants failed to disclose to investors: (1) that the planned “workforce optimization” plan involved implementing arbitrary quotas; (2) that the plan would cut thousands of jobs at the Company; (3) that jobs that were particularly at risk of being cut were held by longer-tenured, knowledgeable, and highly compensated senior personnel; (4) that these job terminations were selectively timed to artificially inflate reported earnings and other financial metrics; (5) that, at the time of the Merger, Defendant Lawrie had forecasted plans for a $2.7 billion workforce reduction in the first year; (6) that, as a result of these workforce terminations, the Company was unlikely to deliver on client contracts; (7) that, as a result of the foregoing, the Company’s clients would be dissatisfied and the relationships would be impaired; and (8) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.
On November 19, 2019, the Court issued an Order appointing Lead Plaintiffs and Counsel. Lead Plaintiffs filed an amended Complaint on January 8, 2020. Defendants filed a Motion to Dismiss the amended Complaint on February 24. On July 27, the Court issued an Order granting Defendants' Motion to Dismiss. Plaintiffs were given leave to amend the Complaint. On September 25, Lead Plaintiffs filed a second amended Complaint.