MILWAUKEE, Wis. (Legal Newsline) - By a relative nose, A Tampa, Fla., firefighters and police pension fund has won lead plaintiff status in shareholder litigation against Generac.
The solar energy company faced two lawsuits after an 8% stock drop that were consolidated before Wisconsin federal judge Brett Ludwig. On May 30, he made his picks for lead plaintiff and lead counsel.
Vying for lead plaintiff were the Tampa pension fund and the Institutional Investor Group, which included the Office of the Treasurer as Trustee for the Connecticut Retirement Plans.
Finding both acceptable lead plaintiffs, Ludwig looked to which lost the most money. Tampa lost $16.2 million, while the Institutional Investors lost $15,667,761.
Counsel for the II argued Tampa's total loss was doctored (Tampa's losses are based on fraud emerging in November 2021, while the other complaint alleged disclosures of fraud beginning August 2022), but Ludwig said at this state he should not "contort the record to suit one party's narrative absent strong evidence of unscrupulous conduct."
Half of Tampa's losses preceded the August 2022 start date alleged in the other complaint.
Robbins Geller is representing the Tampa fund and was picked as lead counsel. Saxena White represented the Institutional Investors.
The plaintiffs allege in their class action that Generac and its senior executives concealed information from investors regarding a defective "SnapRS" component on the company's solar power products. Specifically, the plaintiffs allege that the SnapRS component would overheat, melt and start fires instead of doing what it was designed to do.
They claim that the defendants knew that the component, which was installed on thousands of homes, was defective and dangerous. The plaintiffs also claim several consumer complaints were filed with regulators regarding the defective SnapRS without Generac issuing warnings to investors or consumers.
They also allege the defendants misled investors about the company's financial conditions and about its dependence on "channel partners" to sell, service and install the solar battery systems. The plaintiffs allege that due to the defendants' actions, Generac stock shares declined by 8%.