NEW YORK, Feb. 14, 2013 /PRNewswire/ -- Bernstein Liebhard LLP today announced that a class action has been commenced in the United States District Court for the Southern District of New York on behalf of a class (the "Class") of purchasers of Mellanox Technologies, Ltd. ("Mellanox" or the "Company") (NASDAQ: MLNX) common stock between April 19, 2012 and January 2, 2013 (the "Class Period").
The complaint charges Mellanox and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Mellanox produces and supplies interconnect products for computing, storage, and communication applications in the computing, Web 2.0, storage, financial services, database, and Cloud markets. Mellanox's most lucrative product offering at the start of the Class Period was its InfiniBand product. InfiniBand technology is used to transfer and store data in high-end computing and data centers.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's financial performance and future prospects. According to the complaint, the true facts, which were known or recklessly disregarded by each of the defendants but concealed from the investing public during the Class Period, were as follows: (i) Mellanox was receiving a continuous stream of customer complaints concerning glitches in its InfiniBand product; (ii) Mellanox knew that the pace of a competitor's development of its own InfiniBand adaptor would diminish Mellanox's product offering and increase competition in the InfiniBand market in which Mellanox enjoyed a near monopoly; (iii) Mellanox knew that its outsized first and second quarter 2012 sales growth was not sustainable and was not the result of defendants' business acumen or growth in the InfiniBand market; (iv) Mellanox's inventory was dramatically increasing, both at the Company and in the hands of at least one significant customer, which would decrease sales and profit margins going forward; and (v) as a result, Mellanox knew its actual sales growth supported neither its own fourth quarter 2012 guidance nor the inflated share price targets the investment community was modeling based on defendants' bullish Class Period statements and guidance.
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