Mako Surgical shareholders file 6 lawsuits in 4 months after stock dives (MassDevice)
Mako Surgical reveals 6 shareholder lawsuits filed in the last 4 months over accusations of “misrepresentations and omissions” that may have artificially inflated the company’s shares and led to a 92% drop in value.
Mako Surgical (NSDQ:MAKO) shareholders have filed 6 lawsuits in the last 4 months, accusing the company of misstating the company’s sales and financial outlook in order to artificially inflate its stock value.
In May shareholders James Harrison and Brian Barker each sued the company and its leadership for allegedly misrepresenting sales of Mako’s RIO robotic surgical arm system and hiking the company’s financial guidance for 2012.
The lawsuits came on the heels of a tragic slide on Wall Street. MAKO shares tanked after the company reported Q1 sales of its Rio robotic surgery system that were lower than expected.
The lawsuits were filed on May 10 and 18, after MAKO shares notched a $57% tumble from a closing price of $40.89 on May 1 to a close at $25.97 on May 9. The slide continued through the middle of the month, with shares closing at $21.29 on May 14, a 92% drop from the beginning of the month.
The cases, which are seeking an unspecified amount in damages and other fees, were consolidated earlier this month under lead plaintiffs Oklahoma Firefighters Pension & Retirement System and Baltimore County Employees’ Retirement System, according to Mako’s latest financial report.
In June and July 4 new shareholder complaints alleged that Mako, company leadership and the board of directors “violated their fiduciary duties by allowing the Company to make misrepresentations or omissions that exposed the Company to the Harrison and Parker class actions.”
Two of the lawsuits are proceeding in the Southern District of Florida and the remaining 2 were consolidated in a single case in the 17th Judicial Circuit for Broward County, Fla., according to the company report.
Mako Surgical did not immediately reply to requests for comment.
Mako’s latest earnings statement showed an impressive 79% boost in sales during the 3 months ended March 31, with sales rising to $11.6 million compared with $6.5 million during the same period last year. Losses widened 6.7% to $11.7 million, or 28¢ lost per share.
Mako’s not the only company with disgruntled shareholders.