American Realty Capital Properties Inc (NASDAQ:ARCP) Investor Filed Lawsuit Against Certain Directors Over Alleged Wrongdoing

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Company Name(s): 
American Realty Capital Properties
Case Name: 
American Realty Capital Properties Shareholder Derivative Lawsuit 08/24/2015
Case Status: 
Lawsuit Filed
Affected Securities
NASDAQ: ARCP
Lawsuit Overview
Type of Lawsuit: 
Shareholder Derivative Action
Date Filed: 
08/24/2015
Summary: 

August 26, 2015 (Shareholders Foundation) - An investor in shares of Vereit Inc (NYSE:VER) formerly American Realty Capital Properties Inc) filed a lawsuit against certain directors.

The plaintiff alleges that Vereit Inc formerly American Realty Capital Properties Inc wrongly refused to pursue claims against certain directors breached their fiduciary duties that caused damages to ARCP stockholders.

An earlier lawsuit by another investor in NASDAQ:ARCP shares was recently dismissed for failure to make a prior demand to the board of American Realty Capital Properties Inc.

On October 29, 2014 American Realty Capital Properties Inc (NASDAQ:ARCP) announced the conclusion of its Audit Committee that the previously issued financial statements and other financial information contained in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2013 and Quarterly Reports on Form 10-Q for the fiscal periods ended March 31, 2014 and June 30, 2014, and the Company's earnings releases and other financial communications for these periods, should no longer be relied upon.American Realty Capital Properties Inc also said that it that effective immediately, Michael Sodo has been named Chief Financial Officer of the Company, replacing Brian Block and that Gavin Brandon will serve as Chief Accounting Officer, replacing Lisa McAlister.

On October 30, 2014 a lawsuit was filed against American Realty Capital Properties Inc over alleged securities laws violations. The plaintiff alleged that defendants made allegedly false and/or misleading statements and/or allegedly failed to disclose that American Realty Capital Properties Inc’s financial statements contained errors related to the improper classification of its adjusted funds from operations, ("AFFO"), resulting in an overstatement of AFFO for the three months ended March 31, 2014 and an overstatement of AFFO and an understatement of the Company's net loss for the three and six months ended June 30, 2014, that American Realty Capital Properties Inc lacked adequate internal controls over financial reporting, and that as a result of the foregoing, American Realty Capital Properties Inc’s public statements were materially allegedly false and misleading at all relevant times.