A solar panel maker found itself facing a lawsuit after being accused by investors of insider trading and making misleading statements to shareholders, causing its stock price to drop dramatically.
SunPower Corporation and two of its executives face charges stating that for nearly six months the company misled investors about its faltering financial outlook until it was forced to adjust downward, causing stock prices to fall 30 percent in one day.
Trustees of the police and fire retirement system of Warren, Michigan, brought the investor suit, claiming that the company’s misleading statements caused share prices to drop from $14.78 to $10.31, and accused the two executives of dumping $1.2 million in stock in advance of the company’s negative announcement.
According to the lawsuit, executives of SunPower Corporation knew or disregarded the negative factors impacting the company’s business prospects as early as the beginning of 2016, breaching their fiduciary duty to their shareholders by continuing to cast a positive light on their performance for several months.
On August 9, the company filed statements claiming that several “near-term challenges” were expected to impact their business and financial performance. Further bolstering the plaintiffs’ argument was a statement made by CEO Tom Werner, claiming they knew of the problems as early as May 2016. Company CFO Charles Boynton made statements as late as May, highlighting SunPower’s expectation of exceeding its financial forecast.
SunPower Corporation shareholders argue that despite executives’ rosy outlook, demand decreased while project completion timelines increased, and the company was preparing to downsize. More importantly, the projections are alleged to have kept stock prices artificially high, only dropping once the truth came out.
The suit seeks monetary damages and fees and for SunPower Corporation to reform its business structure. A separate class action was filed in August, which contains similar securities-related charges.
Call a Los Angeles Securities Fraud Attorney Today
If you invested in SunPower Corporation, or believe you have suffered a loss as a result of misstatements or omissions of fact made by a company that you own stock in, you may have certain legal rights that require your immediate attention.
Contact an experienced Los Angeles stock fraud attorney today for a consultation to discuss your rights and options.