Ebix, Inc. Class Action Lawsuit
- Company Name
- Ebix, Inc.
- Stock Symbol
- Class Period
- November 9, 2020 to February 19, 2021
- Motion Deadline
- April 23, 2021
- Southern District of New York
The Ebix, Inc. class action lawsuit charges Ebix and certain of its executives with violations of the Securities Exchange Act of 1934 and seeks to represent purchasers or acquirers of Ebix securities between November 9, 2020 and February 19, 2021 (the “Class Period”). The Ebix class action lawsuit was commenced on February 22, 2021 in the Southern District of New York and is captioned Teifke v. Ebix, Inc., No. 21-cv-01589.
Ebix supplies infrastructure exchanges to the insurance, financial, travel, cash remittances, and healthcare industries.
The Ebix class action lawsuit alleges that, throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (i) there was insufficient audit evidence to determine the business purpose of certain significant unusual transactions in Ebix’s gift card business in India during the fourth quarter of 2020; (ii) there was a material weakness in Ebix’s internal controls over the gift or prepaid revenue transaction cycle; and (iii) Ebix’s independent auditor was reasonably likely to resign over disagreements with Ebix regarding $30 million that had been transferred into a commingled trust account of Ebix’s outside legal counsel; and (iv) as a result of the foregoing, defendants’ positive statements about Ebix’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
On February 19, 2021, after the market closed, Ebix revealed that its independent auditor, RSM US LLP, resigned as a “result of being unable, despite repeated inquiries, to obtain sufficient appropriate audit evidence that would allow it to evaluate the business purpose of significant unusual transactions that occurred in the fourth quarter of 2020” related to Ebix’s gift card business in India. RSM had also stated that there was a material weakness related to Ebix’s failure to design controls “over the gift or prepaid card revenue transaction cycle sufficient to prevent or detect a material misstatement.” In addition, Ebix and RSM disagreed over the accounting treatment of $30 million that had been transferred into a commingled trust account of Ebix’s outside legal counsel in December 2020. On this news, Ebix’s share price fell approximately 40%, damaging investors.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Ebix securities during the Class Period to seek appointment as lead plaintiff in the Ebix class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the Ebix class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Ebix class action lawsuit. An investor’s ability to share in any potential future recovery of the Ebix class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the Ebix class action lawsuit or have questions concerning your rights regarding the Ebix class action lawsuit, please provide your information here or contact counsel, Jennifer Caringal 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 Ebix class action lawsuit must be filed with the court no later than April 23, 2021.
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 seven 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.