Avon Products, Inc. Hit With Investor Lawsuit Over Alleged Securities Laws Violations

If you held Avon Products, Inc. (NYSE: AVP) filed stock at the close of business of March 17, 2011, March 17, 2010, March 18, 2009, March 14, 2008 or March 15, 2007 and were therefore eligible to vote proxies and/or purchased or otherwise acquired Avon Products’ common stock from July 31, 2006 through and including May 24, 2011, you have certain options and there are strict and short deadlines running. Deadline: September 6, 2011. Those AVP stockholders should contact the Shareholders Foundation, Inc.

To have your information reviewed for options and to recieve notifications about this case, please use this form. You may also send an email to mail@shareholdersfoundation.com, or call us at (858) 779-1554.
Company Name(s): 
Avon Products
Case Name: 
Avon Products Shareholder Class Action 07/07/2011
Case Status: 
Lawsuit Filed
Affected Securities
NYSE: AVP
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
07/07/2011
Class Period Begin: 
07/31/2006
Class Period End: 
05/24/2011
Court of Filing: 
U. S. District Court for the Southern District of New York
Deadline To File for Lead: 
09/06/2011
Summary: 

An investor in shares of Avon Products, Inc. (NYSE: AVP) filed a lawsuit in United States District Court for the Southern District of New York against Avon Products over alleged violations of Federal Securities Laws.

According to the complaint the plaintiff alleges on behalf of shareholders who either held Avon Products, Inc stock at the close of business of March 17, 2011, March 17, 2010, March 18, 2009, March 14, 2008 or March 15, 2007 and were therefore eligible to vote proxies or purchased or otherwise acquired Avon Products' common stock from July 31, 2006 through and including May 24, 2011 that Avon Products, Inc violated the Securities Exchange Act of 1934. Specifically, the plaintiff claims that defendants mislead investors as to the size and scope of potential violations of the Foreign Corrupt Practices Act (“FCPA”).
Certain directors of Avon Products face already a lawsuit in 2010 filed by an investor in AVP stocks.
The investors allege in that lawsuit breaches of fiduciary duty by the board of directors of Avon in connection with Avon’s Foreign Corrupt Practices Act (FCPA) compliance problems in 2008.
In October 2008 the door-to-door cosmetics marketer Avon Products announced it notified the U.S. Securities and Exchange Commission (SEC) and Justice Department (DOJ) about its internal investigation of potentially improper payments to Chinese regulators. According to the complaint China had imposed a ban on door-to-door selling in the 1998, which initially forced Avon Products to market its products in stores, but in 2006 Avon received a “license by the Ministry of Commerce, People’s Republic of China […] to permit direct selling, i.e. door-to-door marketing”. Then in September 2008 the deputy director of the Foreign Fund Division of the Chinese Ministry of Commerce was detained for allegedly accepting bribes, so the lawsuit. Avon Products said in its October 2008 announcement that it was looking into whether certain travel, entertainment and other expenses in China might have "been improperly incurred." The Wall Street Journal reported that those possible wrongdoing under investigation include the alleged purchases of trips to France, New York, Canada and Hawaii for a Chinese government official with ties to Avon's business.
Three senior officials of Avon China, the president, chief financial officer and the head of corporate affairs and government relations at its China unit, as well as the head of Avon’s internal audit unit in New York have been accused of improperly providing travel, entertainment, and other expenses in China to a senior official in the Ministry of Commerce and have been put on administrative leave, so the lawsuit. In June 01, 2010 a special report entitled “U.S. Foreign Corrupt Practices Act – No Minor Matter,” Fitch Ratings stated that Avon’s FCPA investigation had “exp[anded to a dozen or more countries”, so the lawsuit.
The plaintiff expects that Avon Products will lose “hundreds of millions of dollars” of assets due to legal liability and/or expenses to investigate, defend, and resolve the FCPA investigation and the inevitable criminal and civil litigation.
On Monday, April 12, 2010, Avon Products announced that four executives have been suspended in connection with an alleged bribery that began with the company's China operation as early as 2008.
When Avon Products back in 2008 disclosed its internal investigation of its China operations, focusing on compliance with the Foreign Corrupt Practices Act, Avon Products shares declined from over $38 per share in the beginning of October 2008 to $24.42 per share on October 20, 2008.