Aurora Cannabis Inc. Class Action Lawsuit
- Company Name
- Aurora Cannabis Inc.
- Stock Symbol
- Class Period
- February 13, 2020 to September 4, 2020
- District of New Jersey
The Aurora Cannabis Inc. class action lawsuit charges Aurora Cannabis and certain of its executives with violations of the Securities Exchange Act of 1934 between February 13, 2020 and September 4, 2020, inclusive (the “Class Period”). The Aurora Cannabis class action lawsuit was commenced on October 2, 2020 in the District of New Jersey and is captioned Lawless v. Aurora Cannabis Inc., No. 20-cv-13819.
Aurora Cannabis produces and distributes medical cannabis products worldwide.
The Aurora Cannabis class action lawsuit alleges that during the Class Period defendants made false and/or misleading statements and/or failed to disclose that: (i) Aurora Cannabis had significantly overpaid for previous acquisitions and experienced degradation in certain assets, including its production facilities and inventory; (ii) Aurora Cannabis’s purported “business transformation plan” and cost reset failed to mitigate the foregoing issues; (iii) accordingly, it was foreseeable that Aurora Cannabis would record significant goodwill and asset impairment charges; and (iv) as a result, Aurora Cannabis’s public statements were materially false and misleading at all relevant times.
On September 8, 2020, Aurora Cannabis issued a press release “announc[ing] an update on its business operations along with certain unaudited preliminary fiscal fourth quarter 2020 results.” Among other things, Aurora Cannabis announced that Aurora Cannabis expected to record up to $1.8 billion in goodwill impairment charges in the fourth quarter of 2020. Aurora Cannabis also disclosed that “previously announced fixed asset impairment charges[ were] now expected to be up to $90 million, due to production facility rationalization, and a charge of approximately $140 million in the carrying value of certain inventory, predominantly trim, in order to align inventory on hand with near term expectations for demand.” On this news, the price of Aurora Cannabis’s stock fell more than 11%, damaging investors.
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