Pomerantz Law Firm Announces the Filing of a Class Action against OSI Systems, Inc. and Certain Officers – OSIS
12/08/2017 | 06:55pm EDT
NEW YORK, Dec. 08, 2017 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against OSI Systems, Inc. (“OSI” or the “Company”) (NASDAQ:OSIS) and certain of its officers. The class action, filed in United States District Court, for the Central District of California, and docketed under 17-cv-08855, is on behalf of a class consisting of investors who purchased or otherwise acquired the securities of OSI between August 16, 2013 and December 5, 2017, both dates inclusive (the “Class Period”). Plaintiff seeks to recover compensable damages caused by Defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder.
If you are a shareholder who purchased OSI securities between August 16, 2013, and December 5, 2017, both dates inclusive, you have until February 5, 2018, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at email@example.com or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and quantity of shares purchased.
OSI Systems, Inc. produces medical monitoring and anesthesia systems, optoelectronic devices, and security and inspection systems. Its subsidiary Rapiscan Systems (“Rapiscan”) provides metal detectors and X-ray machines for screening luggage and cargo.
On January 18, 2012, OSI announced that Rapiscan had been awarded a six-year, $400 million contract to provide turnkey screening services to Mexico’s tax collection authority, Servicio de Administración Tributaria (“SAT”) (the “Mexico Turnkey Contract”).
On August 21, 2013, OSI announced that Rapiscan had been awarded a fifteen-year contract to provide turnkey screening services throughout Albania, stating that “[t]he Company currently anticipates that total gross revenues may range from $150 million - $250 million over the term of the agreement.”
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) the pricing for the Mexico Turnkey Contract was premised on misrepresentations by the Company to SAT regarding the capabilities of Rapiscan’s equipment, and was accordingly overpriced relative to the value of the services provided to SAT; (ii) consequently, the Mexico Turnkey Contract was unlikely to be renewed or was likely to be renewed at terms less favorable to OSI; (iii) the Company’s revenues from the Mexico Turnkey Contract were therefore unsustainable; (iv) OSI had secured the Albania Turnkey Contract by corrupt means; (v) the Company’s revenues from the Albania Turnkey Contract were thus likewise unsustainable; (vi) OSI suffered from systemic, Company-wide problems with respect to legal and regulatory compliance; and (vii) as a result, OSI’s public statements were materially false and misleading at all relevant times.
On December 6, 2017, Muddy Waters Research published a report entitled “OSIS: Rotten to the Core” (the “Muddy Waters Report”). Citing a number of sources—including Albanian media reports, government documents, corporate filings, statements from former OSI employees, and statements from a former SAT official—the 19-page Muddy Waters Report asserted, inter alia, that: (i) OSI had secured the Albania Turnkey Contract by corrupt means; (ii) OSI had misled the SAT with respect to the capabilities of the Company’s machines and thus secured a “greatly inflated” price for the Mexico Turnkey Contract; and (iii) a culture of non-compliance with applicable laws and regulations was endemic at OSI, with “[f]ormer employees paint[ing] a reasonably consistent picture of a company operating with disregard for the law.”
On this news, OSI’s share price fell $24.55, or 29.2%, to close at $59.52 on December 6, 2017.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.