Natus Medical Incorporated
- Company Name
- Natus Medical Incorporated
- Stock Symbol
- Class Period
- October 16, 2015 to April 3, 2016
- Motion Deadline
- March 31, 2017
- Northern District of California
On January 30, 2017, Robbins Geller Rudman & Dowd LLP filed a complaint alleging violations of the federal securities laws by Natus Medical Incorporated and certain of its officers and/or directors. The class action was commenced in the United States District Court for the Northern District of California on behalf of purchasers of Natus common stock between October 16, 2015 and April 3, 2016 (the “Class Period”).
ROBBINS GELLER RUDMAN & DOWD LLP FILES CLASS ACTION SUIT AGAINST NATUS MEDICAL INCORPORATED
San Diego – January 30, 2016 – Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/natus/) today announced that a class action has been commenced on behalf of purchasers of Natus Medical Incorporated (“Natus”) (NASDAQ:BABY) common stock during the period between October 16, 2015 and April 3, 2016 (the “Class Period”). This action was filed in the Northern District of California and is captioned Badger v. Natus Medical Incorporated, et al., No. 17-cv-00458.
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Darren Robbins of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at firstname.lastname@example.org. If you are a member of this class, you can view a copy of the complaint as filed at http://www.rgrdlaw.com/cases/natus/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Natus and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Natus designs, manufactures and markets newborn care and neurology healthcare products and services worldwide.
On October 16, 2015, Natus announced that its Argentinian subsidiary had entered into a three-year supply contract with the Ministry of Health of Venezuela (the “Ministry of Health”) pursuant to which the Company would receive $232.5 million, including $69 million in prepayments “expected” during the first quarter of 2016 (the “Supply Contract”). Thereafter, on October 21, 2015, Natus issued a press release in which it increased its revenue and earnings guidance for its fiscal year ending December 31, 2015.
The complaint alleges that during the Class Period, defendants issued false and misleading statements and/or failed to disclose adverse information regarding the Company’s business and prospects, including, among other things, that: (i) the Venezuelan government had failed to make tens of millions of dollars in prepayments to Natus, which were required to have been paid beginning in October 2015; (ii) Natus had no means to effectively enforce its rights under the Supply Contract, as Venezuela was the exclusive forum for dispute resolution; (iii) Natus’s receipt of revenues pursuant to the Supply Contract was contingent on the outcome of Venezuelan elections; and (iv) as a result of the foregoing, Natus was not on track to achieve the increased guidance provided by defendants and such guidance lacked a reasonable basis. As a result of defendants’ false and misleading statements, Natus stock traded at artificially inflated prices during the Class Period, reaching prices above $50 per share, and certain of the Company’s senior executives were able to cash in $14.5 million worth of their personally held Natus shares at artificially inflated prices.
On January 11, 2016, Natus revealed that it expected to fall short of its fourth quarter and fiscal year 2015 guidance. The Company also disclosed that “[t]he guidance provided by the Company in October for the fourth quarter of 2015 included expected revenue of approximately $4 million under the new Venezuelan Ministry of Health contract,” but “[t]he Company was not able to ship product on the anticipated schedule because the prepayment under the contract was delayed.” On this revelation, the price of Natus common stock declined almost $5 per share, or 11%. On February 29, 2016, Natus filed its Annual Report on Form 10-K for fiscal year 2015 with the SEC, which disclosed that elections in Venezuela and Argentina and Venezuela’s “highly inflationary economy and recessionary economic conditions” “may impact the likelihood of the Venezuelan Ministry of Health’s following through with orders under the agreement, and [Natus’s Argentinian subsidiary] ha[d] not yet received any prepayments under the agreement and no products or services ha[d] been shipped or provided.” The Company attached a copy of the Supply Contract to the 10-K, which disclosed that $69 million in prepayments had been due by the end of 2015 and not the first quarter of 2016, as defendants had represented, and revealed that the Supply Contract was governed solely by Venezuelan law, meaning the Venezuelan government could unilaterally renege on all aspects of the agreement.
Then, on April 4, 2016, Natus issued a press release pre-announcing its preliminary first quarter 2016 results. The release disclosed that revenue would be below the Company’s previous guidance and that Natus did not have “‘any revenue associated with the Venezuela Ministry of Health contract as [it] did not receive any prepayments during the quarter.’” On this news, the price of Natus stock declined $7.80 per share, or nearly 20%, to close at $31.84 per share on April 4, 2016.
Plaintiff seeks to recover damages on behalf of all purchasers of Natus common stock during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has extensive experience in prosecuting investor class actions including actions involving financial fraud.
Robbins Geller is widely recognized as one of the leading law firms advising U.S. and international institutional investors in securities litigation and portfolio monitoring. With 200 lawyers in 10 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history and was ranked first in both total amount recovered for investors and number of securities class action recoveries in ISS’s SCAS Top 50 Report for the last two years. Robbins Geller attorneys have shaped the law in the areas of securities litigation and shareholder rights and have recovered tens of billions of dollars on behalf of the Firm’s clients. Robbins Geller not only secures recoveries for defrauded investors, it also strives to implement corporate governance reforms, helping to improve the financial markets for investors worldwide. Please visit rgrdlaw.com/cases/natus/ for more information.