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SOURCE Robbins Arroyo LLP
SAN DIEGO and SAN JOSE, Calif., March 15, 2013 /PRNewswire/ -- Shareholder rights firm Robbins Arroyo LLP is investigating whether officers and directors of Verifone Systems, Inc. (NYSE: PAY) breached their fiduciary duties to shareholders in making materially false and misleading statements regarding the company's business, operational, and compliance policies.
Robbins Arroyo LLP Investigates Potential Improper Public Statements After Verifone Reports Poor Financial Results for First Fiscal Quarter Ended January 31, 2013
After market closed on February 20, 2013, Verifone issued a press release announcing preliminary financial results for the first quarter ended January 31, 2013, disclosing results that, for the first time in two years, failed to beat analysts' estimates. Analysts were alarmed by the disappointing results and voiced strong skepticism regarding the company's explanation. On the news of its disappointing financial results, Verifone's stock declined $13.65 per share, or nearly 43%, to close at $18.24 per share on February 21, 2013.
In light of this news, Robbins Arroyo is investigating whether Verifone's financial reporting for fiscal years 2011 and 2012 may have been false and misleading because it disregarded several factors, including: (i) Verifone did not properly execute its plan to move to a more subscription-based service model; (ii) past acquisitions had masked Verifone's declining revenue base; (iii) Verifone inappropriately recognized revenues in periods where they should have been deferred; and (iv) Verifone lacked adequate internal and financial controls.
Further, company insiders may have been personally motivated to cause Verifone to issue the false and misleading statements in order to benefit from the sale of Verifone securities from their personal portfolio. Indeed, during the time of the misrepresentations, company insiders sold 247,805 Verifone shares totaling more than $11 million.
Robbins Arroyo LLP highlights that Verifone shareholders have the option to pursue a shareholder derivative action through which shareholders aim to hold insider wrongdoers accountable for their actions, prevent future misconduct, and bring long-term value back to the company. Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, DDonahue@robbinsarroyo.com, or via the shareholder information form on the firm's website.
Robbins Arroyo LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested. For more information, please go to http://www.robbinsarroyo.com.
Press release link: http://www.robbinsarroyo.com/shareholders-rights-blog/verifone/
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