ALEXANDRIA, Va. (Legal Newsline) – Lawyers are trying to convince a Virginia federal judge to pick them to lead a securities class action lawsuit against Pegasystems.
The suit comes after a drop in the value of its stock that followed a huge verdict in a trade secret misappropriation case against it - $2.036 billion. The company’s stock fell 21% after the verdict came down, and the securities suit alleges the company failed to inform investors in the two years prior that there was ever a lawsuit at all.
Hoping to represent all plaintiffs are:
-Robbins Geller, which is representing the Central Pennsylvania Teamsters Pension Fund and the Construction Industry Laborers Pension Fund (approximately $3.4 million in losses);
-Faruqi & Faruqi, which is representing the DeKalb County Pension Fund ($171,113 in losses);
-Labaton Sucharow and Bernstein Litowitz, which is representing the Boston Retirement System and New York City District Council of Carpenters Pension Fund (more than $2.2 million in losses); and
-Abraham, Fruchter & Twersky and Butler Curwood, which is representing the General Retirement System of the City of Detroit (losses not specified).
The company develops customer relationship management software used in the industries of banking, mutual funds and securities, mortgage services, card services, insurance, healthcare management and telecommunications.
Rosy financial outlooks to possible investors included revenue generated from the theft of trade secrets from another company, the suit says. Appian Corporation sued PEGA on May 29, 2020, in Virginia state court, alleging PEGA retained the employee of a government contractor to secretly access Appian software.
After two years of not reporting the lawsuit to investors, the suit says, a Virginia jury hit PEGA with a $2.036 billion verdict. The company's stock dropped 21% in one day - from $65.93 to $52.25.