NEW YORK, May 13, 2014 /PRNewswire/ -- Bernstein Liebhard LLP today announced that a class action has been commenced in the United States District Court for the Southern District of Texas on behalf of purchasers (the "Class") of securities of KBR, Inc. ("KBR" or the "Company") (NYSE: KBR) during the period of April 25, 2013 and May 5, 2014 (the "Class Period").
KBR operates as an engineering, construction and services company, supporting the energy, hydrocarbons, power, minerals, civil infrastructure, government services, industrial and commercial market segments. The Complaint alleges that throughout the Class Period defendants issued false and/or misleading statements and/or failed to disclose material adverse facts concerning KBR's business, operations and prospects. Specifically, defendants misrepresented and/or failed to disclose that: the Company had improperly estimated costs to complete certain contracts; the Company's revenue and financial results were overstated as a result of accounting errors in timing the recognition of revenues and from understating its income tax provision; the Company's financial statements were not prepared in accordance with Generally Accepted Accounting Principles; and the Company lacked adequate internal and financial controls. As a result of the foregoing, the Company's financial statements were materially false and misleading at all relevant times.
On May 5, 2014, KBR announced that the Audit Committee of the Company's Board of Directors concluded that KBR's previously issued consolidated financial statements for the year ended December 31, 2013 should no longer be relied upon and should be restated. KBR determined that the estimated costs to complete seven Canadian pipe fabrication and module assembly contracts that were awarded during 2012-2013 will result in pre-tax charges of more than $150 million, including the reversal of more than $20 million in previously recognized pre-tax profits. The Company also announced that it intends to restate its consolidated financial statement for fiscal 2013, and will postpone filing its Form 10-Q for the period ended March 31, 2014 until after the amended Form 10-K for 2013 is complete. As a result of this news, KBR shares declined $1.61, nearly 7%, to close on May 5, 2014, at $24.23 per share, on unusually heavy volume.
Plaintiffs seek to recover damages on behalf of all Class members who invested in KBR securities during the Class Period. If you invested in KBR securities as described above, and either lost money on the transaction or still hold the security, you may wish to join in this action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than July 8, 2014.A "lead plaintiff" is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiff. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Bernstein Liebhard LLP, or other counsel of your choice, to serve as your counsel in this action.