| Company: | Spectrum Brands, Inc |
| Ticker Symbol: | NYSE: SPC |
| Class Period: | January 4, 2005 to September 6, 2005 |
| Date Filed: | Sep-27-05 |
| Lead Plaintiff Deadline: | Nov-28-05 |
| Court: | Northern District, GA |
| Allegations: |
A class action lawsuit was filed on behalf of all persons who purchased or otherwise acquired the securities of Spectrum Brands, Inc. ("Spectrum Brands" or the "Company").
If you purchased or otherwise acquired the securities of Spectrum Brands between January 4, 2005 and September 6, 2005, inclusive (the "Class Period"), and sustained damages, you may, no later than November 28, 2005, request that the Court appoint you as lead plaintiff.
The action is pending in the United States District Court for the Northern District of Georgia against the Company, and certain of its former officers and directors. According to the complaint, defendants violated sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5, by issuing a series of material misrepresentations to the market during the Class Period.
The complaint alleges that throughout the Class Period, defendants were well aware that the Company's growth model depended upon strong and consistent sales of its core battery products, while at the same time acquiring and integrating diversified brands. Accordingly, throughout the Class Period, defendants consistently represented (1) that the Company was growing through acquisitions and diversifying revenues while maintaining sales of existing products and leveraging existing brands; (2) that the combination of Rayovac and United presented a "compelling value proposition"; (3) that management of the Company had an outstanding track record for successfully integrating acquired brands "while maintaining marketplace momentum" of its legacy brands; (4) that defendants were able to drive revenue growth of its core brands by cross selling its legacy products to accounts acquired through acquisitions; (5) that the representations and warranties contained in the United Merger Agreement were true and accurate at all relevant times; (6) that the Company was achieving "record" sales during the Class Period with double-digit increases in battery sales, "exceptional performance" across the board and with integrations proceeding according to plan; and (7) that by the end of the Class Period the integration of United was substantially complete and also proceeding according to plan.
The representations concerning defendants' ability to acquire and integrate diverse brands such as United and Tetra, while maintaining robust sales of its core battery products, were either patently untrue, or Defendants recklessly disregarded the Company's true operational and financial condition. Unbeknownst to investors, throughout the Class Period, the Company suffered from a host of undisclosed adverse factors that negatively impacted its business and caused it to report financial results that were materially less than the market expectations defendants had caused and cultivated.
It was only at the end of the Class Period that investors ultimately learned that the Company was operating far below expectations and realized that Spectrum Brands had significantly inflated sales of its battery products during the 1st and 2nd quarter of 2005. Accordingly, on July 28, 2005, when defendants reported results for the 3rd fiscal quarter of 2005, the price of Spectrum Brands stock declined over $8.00, falling over 20% to closing at $30.10 per share.
The bad news, however, was not over. On September 7, 2005, prior to the market opening, defendants revealed that earnings for the fourth quarter ending September 30, 2005 would be "substantially lower" than the guidance previously reported. Defendants attributed the shortfall to weak sales and "high (retail) inventory levels." The unexpected news prompted additional analyst downgrades. Analyst William Schmitz noted that "(a)fter two earning warnings in six weeks, we believe already low investor faith in this roll-up is likely to dissipate." In response to the September 7, 2005 news, the stock dropped another 13% on volumes of 4.26 million. In total, the stock lost 31% of its value in response to the disclosures.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
At LawyersandSettlements.com, it is our goal to keep you informed about important legal cases and settlements. We are dedicated to helping you resolve your legal complaints.
If you purchased or otherwise acquired the securities of Spectrum Brands between January 4, 2005 and September 6, 2005, inclusive (the "Class Period"), and sustained damages, you may, no later than November 28, 2005, request that the Court appoint you as lead plaintiff.
The action is pending in the United States District Court for the Northern District of Georgia against the Company, and certain of its former officers and directors. According to the complaint, defendants violated sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5, by issuing a series of material misrepresentations to the market during the Class Period.
The complaint alleges that throughout the Class Period, defendants were well aware that the Company's growth model depended upon strong and consistent sales of its core battery products, while at the same time acquiring and integrating diversified brands. Accordingly, throughout the Class Period, defendants consistently represented (1) that the Company was growing through acquisitions and diversifying revenues while maintaining sales of existing products and leveraging existing brands; (2) that the combination of Rayovac and United presented a "compelling value proposition"; (3) that management of the Company had an outstanding track record for successfully integrating acquired brands "while maintaining marketplace momentum" of its legacy brands; (4) that defendants were able to drive revenue growth of its core brands by cross selling its legacy products to accounts acquired through acquisitions; (5) that the representations and warranties contained in the United Merger Agreement were true and accurate at all relevant times; (6) that the Company was achieving "record" sales during the Class Period with double-digit increases in battery sales, "exceptional performance" across the board and with integrations proceeding according to plan; and (7) that by the end of the Class Period the integration of United was substantially complete and also proceeding according to plan.
The representations concerning defendants' ability to acquire and integrate diverse brands such as United and Tetra, while maintaining robust sales of its core battery products, were either patently untrue, or Defendants recklessly disregarded the Company's true operational and financial condition. Unbeknownst to investors, throughout the Class Period, the Company suffered from a host of undisclosed adverse factors that negatively impacted its business and caused it to report financial results that were materially less than the market expectations defendants had caused and cultivated.
It was only at the end of the Class Period that investors ultimately learned that the Company was operating far below expectations and realized that Spectrum Brands had significantly inflated sales of its battery products during the 1st and 2nd quarter of 2005. Accordingly, on July 28, 2005, when defendants reported results for the 3rd fiscal quarter of 2005, the price of Spectrum Brands stock declined over $8.00, falling over 20% to closing at $30.10 per share.
The bad news, however, was not over. On September 7, 2005, prior to the market opening, defendants revealed that earnings for the fourth quarter ending September 30, 2005 would be "substantially lower" than the guidance previously reported. Defendants attributed the shortfall to weak sales and "high (retail) inventory levels." The unexpected news prompted additional analyst downgrades. Analyst William Schmitz noted that "(a)fter two earning warnings in six weeks, we believe already low investor faith in this roll-up is likely to dissipate." In response to the September 7, 2005 news, the stock dropped another 13% on volumes of 4.26 million. In total, the stock lost 31% of its value in response to the disclosures.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
Register your Securities Complaint
If you have suffered from financial losses, you may qualify for damages or remedies that may be awarded in a possible class action lawsuit. Please fill in our form on the right to submit your complaint and we will have a lawyer review your securities complaint.At LawyersandSettlements.com, it is our goal to keep you informed about important legal cases and settlements. We are dedicated to helping you resolve your legal complaints.
Stay Informed
Get the latest on class action lawsuits, settlements & more! Subscribe to our free weekly newsletter.
Get our Newsletter!
Submit a New Complaint
Been wronged by a similar product or service?
Click here to send us your complaint.
