Altria Group, Inc. Class Action Lawsuit
- Company Name
- Altria Group, Inc.
- Stock Symbol
- Class Period
- December 20, 2018 to September 24, 2019
- Motion Deadline
- December 1, 2019
- Eastern District of New York
On October 2, 2019, the Altria Group, Inc. class action lawsuit was filed charging Altria and certain of its officers with violations of the Securities Exchange Act of 1934. The Altria class action lawsuit was commenced in the Eastern District of New York on behalf of purchasers of Altria securities between December 20, 2018 and September 24, 2019 (the “Class Period”) and is captioned Klein v. Altria Group, Inc., No. 1:19-cv-05579
Altria, through its subsidiaries, manufactures and sells cigarettes, smokeless products, and wine in the United States. Altria sells its tobacco products primarily to wholesalers, including distributors, large retail organizations, and the armed services.
On December 20, 2018, Altria announced it had closed a $12.8 billion investment in JUUL Labs, Inc., the U.S. leader in electronic vapor (“e-vapor”) products, including e-cigarettes. According to Altria, the service agreements related to the transaction would accelerate JUUL’s mission to switch adult smokers to e-vapor products. Altria’s investment represented a 35% economic interest in JUUL, valuing the company at $38 billion, with JUUL purportedly remaining fully independent.
The Altria class action lawsuit alleges that throughout the Class Period, defendants made materially false and misleading statements and/or failed to disclose adverse information regarding Altria’s business and operations. Specifically, defendants failed to disclose: (i) that Altria had conducted insufficient due diligence into JUUL prior to Altria’s investment in JUUL; (ii) the material risks associated with JUUL’s products and marketing practices, and the true value of JUUL and its products; and (iii) that the mounting public scrutiny, negative publicity, and governmental pressure on e-vapor products, and JUUL in particular, made it reasonably likely that Altria’s investment in JUUL would have a material negative impact on Altria’s reputation and operations. As a result of this information being withheld from the market, Altria securities traded at artificially inflated prices, with its stock price reaching a high of more than $57 during the Class Period.
Following Altria’s multi-billion-dollar investment in JUUL, e-vapor products became the subject of increased public and regulatory scrutiny throughout the country. For example, on April 3, 2019, the Food and Drug Administration (“FDA”) announced its investigation into nearly three dozen cases of people suffering from seizures after “vaping.” Between 2010 and 2019, the FDA said it received 35 reports of people, especially children and young adults, experiencing seizures after using e-cigarettes. On this news, Altria’s stock price fell nearly 5%. On August 29, 2019, The Wall Street Journal reported that the Federal Trade Commission was investigating whether JUUL used influencers and other practices to market e-cigarettes to minors. On this news, Altria’s stock price fell over 3%. On September 11, 2019, the Centers for Disease Control and Prevention reported that, as of that date, 380 confirmed cases, and probably cases of lung disease associated with vaping, had been reported by 36 states and the U.S. Virgin Islands, with 6 total deaths confirmed in 6 states. On this news, Altria’s stock price fell more than 5%.
Finally, on September 25, 2019, Altria announced that Philip Morris had called off discussions regarding a $200 billion merger with Altria due to the increased scrutiny of the vaping industry and Altria’s 35% stake in market leader JUUL, which had announced the same day that it was the subject of another federal investigation. JUUL also announced its Chief Executive Officer would step down and that it would stop all advertising in the United States. On this news, Altria’s stock price fell an additional $0.17 per share to close at $40.56 per share on September 25, 2019, a decline of more than 28% from the stock’s Class Period high.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Altria securities during the Class Period to seek appointment as lead plaintiff in the Altria class action lawsuit. A lead plaintiff will act on behalf of all other class members in directing the Altria class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Altria class action lawsuit. An investor’s ability to share in any potential future recovery of the Altria class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the Altria class action lawsuit or have questions concerning your rights regarding the Altria class action lawsuit, please provide your information here or contact counsel, Brian E. Cochran of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at firstname.lastname@example.org. Lead plaintiff motions for the Altria class action lawsuit must be filed with the court no later than December 1, 2019.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For six consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry.