Updated: October 5, 2018
Status: Ongoing Case
On August 13, 2018, Labaton Sucharow LLP was appointed co-lead counsel in a securities class action lawsuit against Acuity Brands, Inc., a lighting manufacturing company based in Atlanta, Georgia, and certain of its senior executives. The action asserts claims under sections Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rules 10b-5 promulgated thereunder, on behalf of all persons and entities who purchased Acuity common stock between October 7, 2015 and April 3, 2017 (the “Class Period”).
On October 5, 2018, lead plaintiffs filed a consolidated complaint that alleges that defendants made repeated misrepresentations and omissions to the market regarding Acuity’s ability to maintain the remarkable rate of sales growth it had experienced in the years prior to the Class Period. Since 2010, Acuity – the dominant North American provider of lighting and building management solutions for commercial, institutional, industrial, infrastructure, and residential applications – had experienced an unbroken run of rapid growth, driven by a recovery in non-residential construction following the financial crisis, and a massive boom in LED lighting technology, which vastly expanded Acuity’s opportunities for both new installations and retrofitting using its products.
However, facing an influx of new competitors, Acuity sought to reinvent itself into a lighting technology company. These efforts were a colossal failure as Acuity’s new products suffered from a host of technical problems and failed to gain widespread adoption. Additionally, Acuity’s most important customer, The Home Depot – which accounted for more than 10 percent of Acuity’s annual revenues for over a decade – began to shift its business away from Acuity in favor of cheaper suppliers overseas. In the face of rapidly deteriorating demand and vanishing prospects for growth, the defendants made a series of materially false statements to the market that concealed known trends negatively impacting sales of Acuity’s products and overstated Acuity’s ability to achieve profitable sales growth.
The case is In re Acuity Brands, Inc. Securities Litigation, No. 18-cv-02140 (N.D. Ga.). Labaton Sucharow represents lead plaintiff Public Employees’ Retirement System of Mississippi. The defendants are Acuity Brands, Inc., Acuity’s CEO Vernon J. Nagel, Acuity’s CFO Richard K. Reece, and Acuity’s former Executive Vice President Mark A. Black.