On November 19, 2013, Bernstein Litowitz Berger & Grossmann LLP (“BLB&G”) filed the first class action lawsuit against Fusion-io, Inc. (“Fusion-io” or the “Company”) (NYSE: FIO), and certain of its senior executives (collectively “Defendants”). The Action, which is captioned Miami Police Relief & Pension Fund v. Fusion-io, Inc., et al., No. 5:13-cv-05368 (N.D. Cal.), asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, 15 U.S.C. §§ 78j(b) and 78t(a), and SEC Rule 10b-5 promulgated thereunder, 17 C.F.R. § 240.10b-5, on behalf of investors who purchased or otherwise acquired Fusion-io securities during the period from August 10, 2012 to October 23, 2013, inclusive (the “Class Period”).
Any member of the proposed Class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain a member of the proposed Class. If you wish to serve as lead plaintiff for the Class, you must file a motion with the Court no later than January 21, 2014.
The Complaint alleges that during the Class Period, Fusion-io and certain of its senior executives violated provisions of the Exchange Act by issuing false and misleading press releases, financial statements, filings with the Securities and Exchange Commission (“SEC”), and statements during investor conference calls. Fusion-io is a computer hardware and software systems company that designs and manufactures memory storage solutions using flash memory technology. Since the Company’s initial public offering in 2011, a limited number of what the Company calls “strategic” customers have accounted for a significant portion of the Company’s revenues.
As alleged in the Complaint, Defendants misrepresented to investors that the Company was a market leader in large-scale flash memory applications and was not facing any competitive pressure or risk from the commoditization of flash memory products. Defendants also issued positive revenue guidance and misrepresented that the Company was able to anticipate the demand from its strategic customers based on its years of experience as their flash memory supplier. As a result of Defendants’ false statements and omissions, Fusion-io’s securities traded at artificially inflated prices during the Class Period. After the market closed on October 23, 2013, the Company revoked its prior revenue guidance and announced that its expected gross margin in 2014 would fall significantly, indicating that the competitive pressures facing Fusion-io were more significant than Defendants had represented. That disclosure caused a material decline in the price of Fusion-io stock.