Robbins Arroyo LLP: Marchex, Inc. (MCHX) Misled Shareholders According to a Recently Filed Class Action
Robbins Arroyo LLP announces that a class action complaint was filed in the U.S. District Court for the Southern District of New York. The complaint alleges that officers and directors of Marchex, Inc. (NASDAQGS: MCHX) violated the Securities Exchange Act of 1934 between March 19, 2014 and September 18, 2014, by making materially false and misleading statements about Marchex’s business prospects. Marchex operates as a mobile advertising technology company in the United States and Canada.
Marchex Lowers Future Guidance
According to the complaint, from March through August 2014, Marchex issued a series of press releases touting the company’s financial results and predicting a positive business outlook. Marchex stated, “Our Call Analytics platform is enabling Marchex to provide unique intelligence and insight around calls at the same time mobile and call-based advertising is emerging as a major theme for advertisers. As a result, we are further integrating with some of our largest advertises and landing new customers.”
However, the complaint alleges that Marchex failed to disclose that Allstate, one of its key customers, sought to switch its business with Marchex to a fixed-fee basis from payments made for each call, and that consequently, Marchex’s revenue would be negatively impacted. In a press release issued on September 18, 2014, Marchex lowered future guidance due to this shift in Allstate’s payment model. On this news, Marchex stock fell $3.38 per share, or over 45%, to close at $4.01 per share on September 18, 2014.
Marchex Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.