Norwegian Cruise Lines Holdings Ltd. Class Action Lawsuit
- Company Name
- Norwegian Cruise Lines Holdings Ltd.
- Stock Symbol
- Class Period
- February 20, 2020 to March 12, 2020
- Southern District of Florida
The Norwegian Cruise Lines Holdings Ltd. securities class action lawsuit charges Norwegian Cruise Lines Holdings Ltd. (“Norwegian”) and certain of its officers with violations of the Securities Exchange Act of 1934 and seeks to represent purchasers of Norwegian publicly traded securities between February 20, 2020 and March 12, 2020 (the “Class Period”). The Norwegian securities class action lawsuit was commenced on March 12, 2020 in the Southern District of Florida and is captioned Douglas v. Norwegian Cruise Lines, Inc., No. 20-cv-21107.
Norwegian operates as a cruise company in North America, Europe, the Asia-Pacific, and internationally. Norwegian operates the Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises brands.
The Norwegian securities class action alleges that throughout the Class Period, defendants assured both passengers and investors alike that Norwegian placed “the utmost importance” on the safety of its passengers while also touting its purported positive financial outlook, despite the growing coronavirus epidemic, which at the time had already accounted for more than 75,000 confirmed cases in 26 countries. In reality, Norwegian had instructed its sales representatives to provide customers blatantly false information about the coronavirus to dissuade them from cancelling upcoming cruise trips. As a result of defendants’ false statements and assurances regarding the coronavirus epidemic itself and its effects on Norwegian’s business and prospects, Norwegian securities traded at artificially inflated prices during the Class Period, with Norwegian’s stock price reaching a high of more than $50 per share.
The truth began to emerge on March 11, 2020, when the Miami New Times published an article entitled “Leaked Emails: Norwegian Pressures Sales Team to Lie About Coronavirus,” illustrating how Norwegian directed its sales staff to lie to customers regarding the coronavirus to protect its bookings. According to the article, “[e]mails leaked to New Times show that a senior sales manager at [Norwegian Cruise Line]’s Miami office came up with canned responses for the sales team to use if potential customers expressed concerns about COVID-19 . . . . Some of the recommended responses are blatantly false. For instance, cruise bookers were instructed to tell potential customers that coronavirus is not a concern in warm Caribbean climates. ‘The Coronavirus can only survive in cold temperatures, so the Caribbean is a fantastic choice for your next cruise,’ one talking point reads. ‘Scientists and medical professionals have confirmed that the warm weather of the spring will be the end of the Coronavirus,’ reads a second. Another line says coronavirus ‘cannot live in the amazingly warm and tropical temperatures that your cruise will be sailing to.’” As a result of this news, the price of Norwegian’s shares declined nearly 27%.
The following day, The Washington Post published a second article revealing that another leaked email showed a Norwegian Cruise Line sales manager had declared that the “coronavirus will not affect you” and “Fact: Coronavirus in humans is an overhyped pandemic scare.” On this news, Norwegian’s stock price fell an additional 35.8% to close at $9.65 per share on March 12, 2020.
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