NEW YORK (Legal Newsline) - Shenanigans by executives at Dentsply Sirona, the world's largest manufacturer of professional dental products, have led to a lawsuit by shareholders over a drop in the company's stock value.
The San Antonio Fire and Police Pension Fund filed a class action on July 26 in New York federal court against the company, Donald Casey and Jorge Gomez. It seeks to form a class of those who invested in the company between June 9, 2021, and May 9, 2022.
The suit says Casey and Gomez, the company's former CEO and CFO, respectively, manipulated the numbers to achieve maximum compensation for the first half of 2021 during the COVID pandemic.
Gomez said at a conference on June 9, 2021, that Dentsply's financial success was due, in part, to a go-to-market strategy that included sophisticated and strategic incentive plans.
When inventory levels increased, the company said that was due to lower-than-sales, the suit says.
"These statements were materially false and misleading," it says. "In truth, Defendants Casey and Gomez had orchestrated a scheme to improperly recognize revenue in violation of (generally accepted accounting principles) and for Casey and Gomez to achieve their 2021 incentive-based compensation."
Gomez resigned April 11, 2022, and Casey was terminated from his position eight days later. The company's stock price dropped more than 13% to 42.20.
An audit, the start of which was announced May 10, questioned whether incentives to sell products to distributors in the second half of 2021 were properly accounted for in statements filed with the SEC. The audit committee also said it was investigating allegations that former and current senior management directed those incentives to boost their executive compensation, the suit says.
Bleichmar Fonti & Auld are representing SAFPPF.