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Wednesday, November 20, 2019

Stockholder in magicJack alleges proxy statement contains misleading statements

By Noddy A. Fernandez | Mar 23, 2018

General court 4

MIAMI (Legal Newsline) – A stockholder in a West Palm Beach, Florida company alleges the company failed to disclose all facts about a proposed transaction.

Melvyn Klein, individually and on behalf of all others similarly situated, filed a complaint on March 9 in the U.S. District Court for the Southern District of Florida against magicJack Vocaltec LTD, et al. over alleged violation of the Securities Exchange Act.

According to the complaint, the plaintiff alleges that on Nov. 9, 2017, magicJack announced that it had entered into an agreement and plan of merger with B. Riley Financial Inc. The merger agreement allegedly states that plaintiff and the class of stockholders "will receive $8.71 per share in cash in exchange for each share of magicJack common stock that they own," the suit states.

The plaintiffs allege that the proxy statement filed by the defendants with the U.S. Securities and Exchange Commission contains materially false and misleading statements regarding the company’s financial projections and the financial analyses.

The plaintiff holds the defendants responsible because they allegedly failed to disclose all material facts about the proposed transaction to shareholders.

The plaintiff requests a trial by jury and seeks to declare that the proxy statement is materially false or misleading, award the putative class rescissory damages, costs of action, and such further relief as the court deems just and proper. He is represented by Scott Egleston of Scott Egleston PA in Miami and Thomas J. McKenna and Gregory M. Egleston of Gainey McKenna & Egleston in New York.

U.S. District Court for the Southern District of Florida case number 9:18-cv-80307-BB

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Gainey McKenna & EglestonU.S. District Court for the Southern District of Florida