BROOKLYN, N.Y. (Legal Newsline) – The class action law firm Robbins Geller is making its move to lead shareholder litigation against information services and analytics company Clarivate and possibly other companies with even deeper pockets.
The firm on March 25 filed a motion to consolidate the three cases already filed against Clarivate and for its client to be picked as lead plaintiff. Two of the cases name only Clarivate and its CEO and CFO as defendants, but a third case filed by Bleichmar Fonti & Auld adds defendants like Citigroup Global Markets, Barclays Capital, J.P. Morgan Securities and PriceWaterHouseCoopers.
Robbins Geller’s client, a firefighters pension fund in Boynton Beach, Fla., bought 375,918 shares and suffered more than $4 million in recoverable losses as a result of alleged wrongdoing, the suit says.
“To the best of its counsel’s knowledge, there are no other plaintiffs with a larger financial interest,” the motion says.
The motion goes on to tout Robbins Geller’s ability to serve as lead counsel, arguing it recovered more than $1.4 billion for investors as sole lead counsel in securities class actions in 2020.
“Robbins Geller attorneys have obtained the largest securities fraud class action recovery in the Fifth, Seventh, Eighth, Tenth and Eleventh circuits…” the motion says.
Clarivate went public in May 2019 and faces allegations its financial statements misled investors because of mistakes in its accounting.
In June, it raised $1.4 billion with a preferred shares offering based on figures released in its quarterly reports.
"These statements were materially false and misleading," the suit says. "In truth, Clarivate's financial statement... violated generally accepted accounting principles, the company maintained defective disclosure controls and procedures as a result of material weakness in its internal control over financial reporting, and the foregoing material weakness was not limited to how the company accounted for warrants."
On Dec. 27, Clarivate admitted to an error. It incorrectly recorded as part of accounting for the acquisition of CPA Global about $185 million in equity awards, the suit says.
"To correctly amount for the equity awards, (generally accepted accounting practices) recognized Clarivate to recognize the equity awards expenses as stock-based compensations charges over the vesting period from Oct. 1, 2020, to Oct. 1, 2021, with only a portion of the liability recorded as part of the acquisition accounting."