BENSALEM, Pa.--(BUSINESS WIRE)--Law Offices of Howard G. Smith announces that a class action lawsuit has been filed on behalf of investors who purchased or otherwise acquired Overstock.com, Inc. (“Overstock” or the “Company”) (NASDAQ: OSTK) securities between May 9, 2019 and September 23, 2019, inclusive (the “Class Period”). Overstock investors have until November 26, 2019 to file a lead plaintiff motion.
Investors suffering losses on their Overstock investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to email@example.com.
On August 12, 2019, Overstock’s Chief Executive Officer (“CEO”) Patrick M. Byrne caused the Company to publish a press release entitled “Overstock.com CEO Comments on Deep State, Withholds Further Comment.” The press release contained, among other things, references to “political espionage conducted against Hillary Clinton and Donald Trump (and to a lesser degree, Marco Rubio and Ted Cruz)” and references to “the Men in Black.”
Following this abnormal press release, the Company’s stock price fell $9.00 per share, or nearly 36%, over two consecutive trading sessions, to close at $15.97 per share on August 14, 2019, thereby injuring investors.
Then, on September 16, 2019, Bloomberg reported that the tZERO crypto currency project, which had been initiated by Byrne before he left the Company, was specifically designed to deter short sellers by impeding their ability to transfer the dividends.
On this news, the Company’s stock price fell $7.33 per share, or over 29%, over two consecutive trading sessions, to close at $17.60 on September 17, 2019, thereby injuring investors further.
Finally, on September 22, 2019, media reported that Byrne had sold his entire stake in the Company due to regulatory scrutiny of the tZERO project.
On this news, the Company’s stock price fell $3.78 per share, or over 25%, to close at $11.19 per share on September 23, 2019, thereby injuring investors further.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that it was not true that Overstock would be able to support the launch of its tZERO crypto currency with earnings or cash flow from its Retail operations and that whatever marginal improvements defendants had made by cutting costs and engineering earnings, could not be sustained so as to generate positive EBITDA or cash from operations necessary to support its crypto currency operations; (2) that the extreme additional risks and the substantial volatility in the price of Company shares was foreseeable, given defendants' undisclosed plan to offer its tZERO Preferred Share Dividend as a means to squeeze short sellers out of Overstock, and to prevent them from holding legitimate positions in the Company; (3) that the Company's ability to accomplish its intended short squeeze would embolden the SEC or even market participants, such as major brokerage houses, to act to prevent this market manipulation; (4) that Overstock did not have adequate systems of internal operational or financial controls, such that Overstock's quarterly reports filed with the SEC were true, accurate or reliable; (5) that, as a result of the foregoing, it was not true that the Company's quarterly reports filed with the SEC were prepared in accordance with GAAP ad SEC rules; (6) that defendants lacked any reasonable basis to claim that Overstock was operating according to plan, or that Overstock could achieve guidance sponsored and/or endorsed by defendants; and (7) that as a result, Overstock's public statements were materially false and misleading at all relevant times.
If you purchased Overstock securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020 by telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to firstname.lastname@example.org, or visit our website at www.howardsmithlaw.com.
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