OAKLAND, Calif. (Legal Newsline) — A North Miami police officers and firefighters retirement plan alleges a data management company's intentional false statements led to a more than 20% stock decline and its economic damages.
Retirement Plan For Police Officers & Firefighters of the City of North Miami Beach filed a complaint March 21 in the Northern District of California against Douglas Merritt, Jason Child and Splunk Inc., alleging violations of federal securities laws, unjust enrichment and other claims.
According to the plaintiff's complaint, Splunk is a San Francisco-based data management company. It claims Splunk knowingly made false and misleading statements between May and December of 2020 regarding the company's investments, sales and the impact of the COVID-19 pandemic on the company.
The plaintiff further claims the defendants' false statements brought the company's stock to a high of $220.42 per share and allowed the company to complete a $1.2 billion debt offering to continue to fund Splunk's operations. The plaintiff also claims Splunk used the inflated stock prices to get stockholder approval for a personal compensation package of $39.02 million.
The suit alleges Splunk was not investing in marketing or keeping adequate sales personnel, had a hiring freeze and conducted layoffs, which all affected the company's growth and revenue targets. The plaintiff also alleges the false information led to Splunk missing revenue estimates by nearly $60 million and its stock falling by 23% in December of 2020.
The plaintiff seeks monetary relief, interest, trial by jury and all other just relief. It is represented by Travis Downs, III, Benny Goodman, III and Erik Luedeke of Robbins Geller Rudman & Dowd LLP in San Diego.
Northern District of California Circuit Court case number 3:23-CV-01313-LB