Coughlin Stoia Geller Rudman & Robbins LLP announced Tuesday (Sept. 1) that a class action suit has been filed in the United States District Court for the Central District of California on behalf of purchasers of the common stock of Fleetwood Enterprises Inc. between Dec. 6, 2007, and March 10, 2009.
The suit seeks to pursue remedies under the Securities Exchange Act of 1934, according to a news release.
Fleetwood is not named in this action as a defendant because it and its core operating subsidiaries filed for bankruptcy protection in March.
Fleetwood shareholders who wish to join the suit must notify the court no later than 60 days from Tuesday. They may do so through plaintiff’s counsel Samuel H. Rudman or David A. Rosenfeld of Coughlin Stoia at (800) 449-4900 or (619) 231-1058, or via e-mail at [email protected].
A copy of the complaint as filed is available online at www.csgrr.com/cases/fleetwood/
The complaint charges certain Fleetwood’s executives, CEO Elden Smith and former CFO Boyd Plowman, now a consultant to the company, with violations of the Exchange Act. Fleetwood, together with its subsidiaries, produced and distributed manufactured housing primarily in the United States and Canada.
The complaint alleges that from December 2007 until the bankruptcy filing, Fleetwood executives made numerous positive statements regarding the company’s financial condition, business and prospects. The complaint further alleges that these statements were materially false and misleading because defendants failed to disclose the following adverse facts, among others:
- Demand for Fleetwood’s manufactured houses and the big homes-on-wheels was rapidly declining, and was adversely affecting the company’s liquidity.
- The company’s RV Group sales, especially in its travel trailer division, were declining because of softening consumer demand due to high gasoline prices and the credit crisis.
- The company’s financial condition was declining precipitously such that the company was nearing insolvency and would have to file for bankruptcy protection.
- Based on the foregoing, defendants had no reasonable basis for their positive statements regarding the Company’s ability to control its deteriorating financial condition.
On March 10, Fleetwood issued a press release announcing that it had “filed voluntary Chapter 11 petitions for itself and certain operating subsidiaries in the U.S. Bankruptcy Court for the Central District of California.” The company also announced that it was closing its travel trailer division. As a direct result of information disclosed, the price of Fleetwood common stock fell precipitously, falling to 1 cent per share on March 10.
Plaintiff seeks to recover damages on behalf of all purchasers of Fleetwood common stock during the period in question. The plaintiff is represented by Coughlin Stoia, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Coughlin Stoia, a 190-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Fla., Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations.