On February 10, 2010, after the market closed, Schweitzer reported its fourth quarter and full year 2009 financial results. In the conference call following the release, defendants disclosed the Company’s most important customer’s decision to try competitive products and announced its filing of a patent lawsuit against competitors. As a result, Schweitzer’s stock tumbled $23.58 per share to close at $46.65 per share on February 11, 2010, a one-day decline of nearly 34%, on volume of nearly 14 million shares.According to the complaint, the true facts, which were then known by or available to the defendants during the Class Period, were: (a) Schweitzer’s competitive position was not adequately protected from foreign competition as to low ignition propensity (“LIP”) paper, as such competitors were increasingly developing alternative methods to manufacture banded LIP paper; (b) the Company’s most important customer was not in agreement with Schweitzer as to a license agreement between the two companies; and (c) the Company’s competitive position was much more precarious than represented by defendants and the efforts by other manufacturers to invade Schweitzer’s territory were growing. Plaintiff seeks to recover damages on behalf of all purchasers of Schweitzer common stock during the Class Period (the “Class”). The plaintiff is represented by Coughlin Stoia, which has extensive experience in prosecuting investor class actions and actions involving financial fraud.
Coughlin Stoia Geller Rudman & Robbins LLP (“Coughlin Stoia”) ( http://www.csgrr.com/cases/schweitzer/) today announced that a class action has been commenced on behalf of an institutional investor in the United States District Court for the Northern District of Georgia on behalf of purchasers of Schweitzer-Mauduit International, Inc. (“Schweitzer”) (NYSE:SWM) common stock during the period between August 5, 2009 and February 10, 2010 (the “Class Period”). If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Darren Robbins of Coughlin Stoia at 800/449-4900 or 619/231-1058, or via e-mail at firstname.lastname@example.org. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.csgrr.com/cases/schweitzer/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. The complaint charges Schweitzer and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Schweitzer manufactures and sells paper and reconstituted tobacco products to the tobacco industry, as well as specialized paper products for use in other applications. The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and financial results. Specifically, during the Class Period defendants misrepresented the strength of Schweitzer’s competitive position and concealed problems with Schweitzer’s most important customer. As a result of defendants’ false and misleading statements, Schweitzer’s stock traded at artificially inflated prices during the Class Period, reaching a high of $82 per share on January 14, 2010. As a result of this inflation, Schweitzer was able to consummate a secondary offering of 1.8 million shares of its stock at $60 per share in November 2009.