Cohen Milstein Sellers & Toll PLLC Announces The Investigation Of OCZ Technology Group, Inc.
Cohen Milstein Sellers & Toll PLLC is conducting an investigation to determine whether OCZ Technology Group, Inc. (“OCZ” or the “Company”) and certain of its officers and directors made false and misleading statements and/or omissions in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
Several class action lawsuits were filed in the U.S. District Court for the Northern District of California by other law firms on behalf of purchasers of the common stock of OCZ Technology Group, Inc. (NASDAQ: OCZ) between July 10, 2012 and October 11, 2012, inclusive (the “Class Period”).
The complaints allege that OCZ Technology Group, Inc. and certain of its officers and directors (“Defendants”) misrepresented and/or failed to disclose that: (1) OCZ was providing extraordinary customer incentives in excess of what was normal and customary in the past; (2) OCZ was improperly accounting for customer incentive programs; (3) the Company's financial results were misstated during the Class Period; (4) OCZ lacked adequate internal and financial controls; and (5) as a result of the foregoing, Defendants’ positive statements about OCZ's business, operations and prospects lacked a reasonable basis.
On September 5, 2012, OCZ reported preliminary revenues for the second fiscal quarter that were significantly lower than previously announced guidance. Defendant Ryan M. Petersen, then President and CEO of OCZ, told investors that the financial shortfall was primarily due to product-component shortages. Less than two weeks later, on September 17, the Company announced that defendant Petersen had resigned, offering no explanation for his abrupt departure.On October 10, OCZ announced that it was seeking an extension of time to file its second quarter Form 10-Q, telling investors that its financial statements were “ under review” and warning that the preliminary revenue results announced on September 5 should not be relied upon. The company further disclosed that there would be “material changes [to revenue estimates] due to customer incentives that were in excess of what was normal and customary in the past.” The price of OCZ shares dropped from $3.15 to $1.88 on this news. On October 11, the last day of the Class Period, OCZ filed a Form NT 10-Q disclosing a further delay in filing its second quarter Form 10-Q. The Company reported that it “ cannot currently estimate the exact filing [date]…as it requires additional time to complete the accounting review concerning the impact of its customer incentive programs on its financials.” The price of OCZ shares fell from $1.86 to $1.47 on October 12. Cohen Milstein encourages all investors who purchased OCZ common stock between July 10, 2012 and October 11, 2012 or former employees with information concerning this matter to contact the firm.
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