Glancy prongay & murray llp files securities class action on behalf of armstrong flooring, inc. investors
Glancy prongay & murray llp announced that it has filed a class action lawsuit in the united states district court for the central district of california captioned chupa v. armstrong flooring, inc., et al., (case no. 2:19-cv-09840), on behalf of persons and entities that purchased or otherwise acquired armstrong flooring, inc. securities between march 6, 2018 and november 4, 2019, inclusive. plaintiff pursues claims under sections 10(b) and 20(a) of the securities exchange act of 1934. investors are hereby notified that they have 60 days from the date of this notice to move the court to serve as lead plaintiff in this action. on may 3, 2019, armstrong flooring’s chief executive officer abruptly resigned. on this news, the company’s stock price fell $1.75, nearly 12%, to close at $13.14 per share on may 3, 2019, thereby injuring investors. then, on november 5, 2019, before the market opened, armstrong flooring reported $165.6 million net sales for third quarter 2019, a nearly 21% decline year-over-year, and a net loss of $31.4 million. the company also cut its full year 2019 guidance for adjusted ebitda to a range of $20 million to $25 million, from prior guidance range of $46 million to $54 million, citing “larger distributor movements on inventory” than anticipated. on this news, the company’s stock price fell $2.90 per share, or nearly 44%, to close at $3.70 per share on november 5, 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 the company had engaged in channel stuffing to artificially boost sales; (2) that the company’s internal control over inventory levels was not effective; and (3) that, as a result of the foregoing, defendants’ positive statements about the company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.
