Hagens Berman Sobol Shapiro LLP, a national investor-rights law firm, today advised investors of the Oct. 15, 2013 deadline to move to be a lead plaintiff in a securities class-action lawsuit against ECOtality, Inc. (NASDAQ: ECTY) and the continuing investigation into whether ECOtality withheld critical information from investors. Investors are invited to inquire about their options with Hagens Berman attorneys by emailing ECTY@hbsslaw.com.
If you purchased ECTY common stock between April 16, 2013, and Aug. 9, 2013 (the “Class Period”) and suffered significant financial losses, you may also contact Hagens Berman Partner Reed Kathrein, who is leading the firm’s investigation, by calling (510) 725-3000. You can submit information online at http://hb-securities.com/investigations/ECTY.
On June 19, 2013, ECOtality closed an $8.2 million private placement of over 5 million shares of common stock priced at $1.60 and warrants exercisable at $2.04 per share. On Aug. 12, 2013, ECOtality announced a litany of previously undisclosed problems and stated that it had hired a restructuring adviser to evaluate the company’s options including a possible bankruptcy filing which could be made “in the very near future.” Following the announcement, the company’s stock price dropped more than 87 percent.
The lawsuit alleges that ECOtality failed to disclose key information to its investors in advance of the Aug. 12, 2013, announcement. The complaint alleges that ECOtality concealed major issues and problems, including defects and performance shortfalls in some of its charging systems, the inability to release new products as scheduled, as well as a lack of sufficient commercial sales and investor funding to sustain the company’s operations.“It seems highly unlikely that ECOtality would be completely unaware of these many issues prior to its August disclosure,” said Hagens Berman Partner Reed Kathrein. “Our investigation centers on what they knew, and when they knew it prior to August 12, and more particularly, as it was trying to raise cash.”