Suit targets Plug Power
Latham fuel cell maker revealed issue, which led to hefty sell-off
Latham fuel cell maker reveals accounting trouble; shareholder then sues over losses.
The first class-action lawsuit has been brought against Plug Power after the Latham fuel cell maker revealed accounting issues earlier this month that led to a major sell-off of its shares.
The suit was filed in U.S.
District Court in Manhattan on behalf of shareholder Dawn Beverly, who purchased 225 shares of Plug Power on Feb. 23 at $44.29 apiece.
Beverly, who appears to live in Pennsylvania, is represented by the law firm Glancy Prongay & Murray in New York City, which has been seeking other Plug Power shareholders to join in the suit.
Such securities class action lawsuits are commonplace after public companies announce adverse news that leads to their stock price falling.
Shares of Plug are down 30 percent since a March 2 filing with the U.S. Securities Commission in which the company said it would likely need to correct past financial statements due to evolving interpretations of how it should categorize certain assets and spending.
Plug Power has stressed that none of the expected changes to be made to its financial statements will involve spending
future cash. Although Plug Power has yet to break even and turn a profit, it has brought on so many investors that its market capitalization, or stock market value, is roughly $19 billion.
The company is predicting $475 million in billings for its services this year. The company makes hydrogen fuel cells used in vehicles and also sells hydrogen and hydrogen fueling equipment.
Plug Power says it may need to adjust past financial statements
“The complaint filed in this class action 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,” Glancy Prongay & Murray said in a press release seeking to obtain the cooperation with other Plug Power shareholders.
Plug Power did not respond to a request for comment on the lawsuit.
Shares (Nasdaq: PLUG) lost $2.97, or 7.55 percent, to close at $36.36 Thursday but were up 2 cents in early after-hours trading.