Orion Energy Systems Inc (NASDAQ: OESX) Investor Securities Class Action Lawsuit 02/11/2008

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Company Name(s): 
Orion Energy Systems
Case Name: 
Orion Energy Systems Shareholder Class Action Lawsuit 02/11/2008
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Approved
Affected Securities
NASDAQ: OESX
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
02/11/2008
Class Period Begin: 
12/18/2007
Class Period End: 
02/07/2008
Court of Filing: 
U.S. District Court for the Southern District of New York
Date Settled: 
04/14/2011
Settlement Amount: 
$3,250,000
Deadline to Participate in Settlement: 
04/18/2011
Summary: 

April 14, 2011 - The court approved the settlement, entered the orders approving the plan of allocation, the motion for attorneys’ fees and expenses, and dismissing the action with prejudice.

January 3, 2011 - The court preliminarily approved the settlement.

September 17, 2010 - Parties filed a stipulation of settlement.

September 4, 2009 - The lead plaintiff filed a second amended complaint.

August 20, 2009 - The court granted in part and denied in part the defendants' motion to dismiss and granted plaintiff leave to file an amended complaint.

September 15, 2008 - The defendants filed a motion to dismiss.

August 1, 2008 - The lead plaintiff filed an amended consolidated complaint.

April 11, 2008 - Lead plaintiff motions were filed.

March 21, 2008 - Another investor filed a complaint.

February 28, 2008 - Another investor filed a complaint.

February 11, 2008 - An investor in shares of Orion Energy Systems Inc (AMEX: OESX) filed a lawsuit in the U.S. District Court for the Southern District of New York against Orion Energy Systems Inc over alleged violations of Federal Securities Laws.

The complaint charges Orion Energy Systems Inc, certain of its officers and directors and the underwriters who sponsored the December 18, 2007 IPO with violation of the federal securities laws by issuing a Registration Statement and Prospectus in connection with the IPO which was materially false or misleading due to omissions. The law generally imposes strict liability on defendants responsible for a materially false Registration Statement and Prospectus, including for purchases made in the open market after the IPO; no fraud need be proved to recover.

Orion Energy Systems Inc is a manufacturer of efficient lighting and energy systems to businesses. The Prospectus for its IPO described a Company that was quickly growing revenues from existing product lines, and briefly described product line extensions. After the close of trading on February 6, 2008, Orion Energy Systems Inc revealed that revenues in its current fiscal quarter would decline as Orion Energy Systems Inc took aggressive measures to promote a "new business model,'' a change in focus that is alleged not to have been adequately disclosed or described in the IPO Prospectus. During the February 6, 2008 conference call, Orion Energy Systems Inc executives, including the CEO, appeared unable to explain to the satisfaction of securities analysts this surprising news about the business model change on the heels of the IPO, or its impact on revenues.

The plaintiff alleges that Orion Energy Systems Inc realized over $78 million in proceeds, while its Chief Executive Officer and family sold 600,000 shares for proceeds of approximately $7 million. On February 6, 2008, just weeks after its IPO, Orion Energy Systems Inc revealed news concerning the company which completely surprised analysts and investors, and caused the stock to drop approximately 43%, to a price of $8.51 per share.