NEW YORK, July 21, 2017 — Labaton Sucharow LLP announces that on July 20, 2017, it filed a securities class action lawsuit on behalf of its client Oklahoma Firefighters Pension and Retirement System (Oklahoma Firefighters) against Lexmark International, Inc. (Lexmark) (NYSE:LXK), and certain of its senior executives (collectively, the defendants). The action, which is captioned Oklahoma Firefighters Pension and Retirement System v. Lexmark International, Inc., No. 17-cv-05543 (S.D.N.Y.), asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the Exchange Act), and U.S. Securities and Exchange Commission (SEC) Rule 10b-5 promulgated thereunder, on behalf of all investors who purchased or otherwise acquired the publicly traded securities of Lexmark between August 1, 2014 and July 20, 2015, both dates inclusive (the class period).
The complaint alleges that during the class period, the defendants violated provisions of the Exchange Act by issuing false and misleading statements regarding the company’s end-user demand, channel inventory, and growth prospects for its high-margin supplies business. Lexmark is a manufacturer of printers and related supplies, primarily ink cartridges. Lexmark sells its products to wholesale distributors and large retail chains in more than 90 countries around the world.
During the class period, Lexmark repeatedly touted the profitability and growth of its high-margin supplies business. However, the defendants’ class period statements pertaining to the company’s profitability and growth prospects were materially false and misleading because the defendants failed to disclose that: (1) end-user demand and growth for the company’s supplies business was deteriorating; (2) pricing increases were the primary driver of supplies revenue growth, not end-user demand; (3) customers in the supplies channel reacted by buying ahead of anticipated pricing increases; and as a result, (4) there were excessive inventory levels at its European wholesale distributors.
On July 21, 2015, when Lexmark reported poor results for its second quarter ending June 30, 2015 and lowered its 2015 sales guidance, the company ultimately revealed its supplies growth was not attributable to end-user demand but rather the result of its European customers buying ahead of customary price increases which produced excessive inventory. In reaction to this revelation, the company’s stock price dropped $9.57 per share, or 20.2 percent, to close at $37.75 per share on July 21, 2015.
If you purchased or acquired the publicly traded securities of Lexmark during the class period, you are a member of the class and may be able to seek appointment as the lead plaintiff. Lead plaintiff motion papers must be filed with the U.S. District Court for the Southern District of New York no later than September 19, 2017. The lead plaintiff is a court-appointed representative for absent members of the class. You do not need to seek appointment as the lead plaintiff to share in any class recovery in this action. If you are a class member and there is a recovery for the class, you can share in that recovery as an absent class member. You may retain counsel of your choice to represent you in this action.
If you would like to consider serving as the lead plaintiff or have any questions about this lawsuit, you may contact Francis P. McConville, Esq. of Labaton Sucharow, at (800) 321-0476, or via email at firstname.lastname@example.org. You can view a copy of the complaint online here.