Power lawsuits merged as share price drop continues
Fuel cell manufacturer has seen selloff after accounting questions, restatements
Plug Power’s legal troubles over its accounting problems continue in both federal and state courts, but the focus has been narrowed as several of the cases have been merged together.
Plug Power is the Latham fuel cell manufacturer that has become a leading innovator in the renewable energy and hydrogen market with its hydrogenpowered fuel cells that are made to power motor vehicles.
Although Plug Power has yet to turn a profit, it has vowed to become the world’s leading fuel cell maker and a leading manufacturer of so-called green hydrogen using electrolysis, a process that uses water instead of fossil fuels like methane to extract hydrogen molecules.
Despite its enormous revenue growth as it expands into new markets in the United States and abroad, Plug Power was pummeled by Wall Street earlier this year after it disclosed that it had been unable to provide a proper accounting of its financial condition due to its growth in an evolving renewable energy market that was difficult to quantify exactly.
The company’s accounting disclosures, which resulted in the company reporting more revenue than previously disclosed, led to several shareholders bringing lawsuits against the company for “unjust enrichment” and “waste of corporate assets,” although the accounting restatements didn’t result in a major change in the company’s financial position.
In its Aug. 5 quarterly financial report with the U.S. Securities and Exchange Commission, Plug Power says that the federal lawsuits have been consolidated, making them more manageable.
Shares of Plug Power hit $73 in January but have plummeted since then. As of August, Plug shares have been trading under $30 and ended trading Thursday at $23.76, a 5 percent drop on the day and a 68 percent drop since the January high.
Court records and filings by Plug Power with the SEC say that the federal lawsuits, which seek class action status that would allow most shareholders of Plug Power to join the legal action, have been combined into one lawsuit. A lawsuit filed in state court in May by a Plug Power shareholder is also outstanding.
A Plug Power spokesperson declined to comment Thursday on the lawsuits.