Allot Communications Ltd (NASDAQ: ALLT) Investor Securities Class Action Lawsuit 04/30/2007

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Company Name(s): 
Allot Communications
Case Name: 
Allot Communications Ltd Shareholder Class Action Lawsuit 04/30/2007
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Approved
Affected Securities
NASDAQ: ALLT
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
04/30/2007
Class Period Begin: 
11/15/2006
Class Period End: 
04/02/2007
Court of Filing: 
U.S. District Court for the Southern District of New York
Date Settled: 
04/29/2011
Settlement Amount: 
$1,300,000
Deadline to Participate in Settlement: 
03/28/2011
Summary: 

April 29, 2011 - The court approved the settlement.

December 13, 2010 - The court preliminarily approved the settlement.

August 5, 2010 - Parties filed a stipulation of settlement.

March 31, 2010 - The court denied without prejudice the defendants' motion to dismiss.

August 8, 2008 - The defendants filed a motion to dismiss.

June 9, 2008 - The lead plaintiff filed an amended complaint.

March 27, 2008 - The lead plaintiff and lead counsel were appointed.

July 2, 2007 - Lead plaintiff motions were filed.

April 30, 2007 - An investor in shares of Allot Communications Ltd (NASDAQ: ALLT) filed a lawsuit in the U.S. District Court of the Southern District of New Yrok against Allot Communications Ltd over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between November 15, 2006 and April 2, 2007.

The complaint charges Allot Communications Ltd and certain of its officers, directors and underwriters with violations of the Securities Act of 1933. Allot Communications Ltd is a designer, developer, marketer, and seller of broadband service optimization solutions. Allot Communications Ltd’s solutions provide broadband service providers and enterprises with real-time visibility into, and control of, network traffic.

The complaint alleges that the Registration Statement and Prospectus issued in connection with the IPO were negligently prepared and, as a result, contained untrue statements of material facts; omitted to state other facts necessary to make the statements made therein not misleading; and were not prepared in accordance with the rules and regulations governing their preparation. Specifically, the complaint alleges, among other things, that the Registration Statement and Prospectus included representations that the Company would achieve its goal in becoming the leader in its industry through its ability to market and sell its products to end-customers through its channel partners. In fact, according to the complaint, the Registration Statement and Prospectus failed to disclose that Allot was experiencing declining sales in its indirect distribution channels, such as enterprise, education and smaller ISP customers, in North America.

On April 2, 2007, Allot Communications Ltd issued a press release announcing that revenues and earnings for the first quarter of 2007 and the 2007 fiscal year would be lower than its previous guidance - given less than two months ago. Allot Communications Ltd attributed the lower guidance to “weakness in sales from some of Allot Communications Ltd’s distributors, principally in the Americas, which are focused on sales to enterprise, education, and smaller ISPs.” In response to the announcement about Allot Communications Ltd’s revised guidance, on April 2, 2007, the price of Allot Communications Ltd (NASDAQ: ALLT) stock declined precipitously falling from $9.15 per share to $7.11 per share - approximately 40% below the IPO price - on heavy trading volume.