According to the Complaint, Carbonite, Inc. is a software company that provides cloud-based backup services, including the Server Backup VM Edition for managed services providers (“MSPs”), which was designed to allow MSPs to protect their virtual data both locally and in their own cloud.
The Complaint alleges that during the Class Period, Defendants issued materially false and misleading statements and/or failed to disclose adverse information regarding the technological quality of the Server Backup VM Edition and its potential to add “meaningfully” to Carbonite’s financial performance for fiscal 2019. Specifically, the Complaint alleges Defendants failed to disclose that: (i) Carbonite’s Server Backup VM Edition was of poor quality and technologically flawed; (ii) Carbonite was receiving poor reviews and complaints from customers about the Server Backup VM Edition; and (iii) the poor quality and technological flaws of the Server Backup VM Edition were acting as a “disruptive” factor throughout the Carbonite salesforce and keeping that sales organization from closing opportunistically on several larger deals during fiscal 2019.
On November 21, 2019, the Court issued an Order consolidating cases and appointing Lead Plaintiff and Counsel. Lead Plaintiff filed a consolidated amended Complaint on January 15, 2020. Defendants filed a Motion to Dismiss the consolidated amended Complaint on March 10. On October 22, the Court issued an Order granting Defendants' Motion to Dismiss. The claims were dismissed with prejudice. On November 20, Plaintiff filed a notice appealing the Court's Dismissal Order.
On December 22, 2021, the Court of Appeals reversed the judgment of the District Court and remanded for further proceedings.
Plaintiffs filed a Motion for Class Certification on September 16, 2022. On July 14, 2023, the Court issued an Order granting Class Certification.
The parties entered into a Stipulation of Settlement on January 31, 2024. On February 1, the Court granted preliminary approval of the Settlement.