Rocket Fuel, Inc.
Robbins Arroyo LLP: Rocket Fuel, Inc. (FUEL) Stock Falls 30% After Violations of Federal Law are Revealed, According to Class Action
Robbins Arroyo LLP announces that an investor of Rocket Fuel, Inc. (NasdaqGS: FUEL) has filed a federal securities fraud class action complaint in the U.S. District Court for the Northern District of California. The complaint alleges that the company and certain of its officers and directors violated the Securities Exchange Act of 1934 between September 20, 2013 and August 5, 2014. Rocket Fuel provides artificial-intelligence digital advertising solutions.
Rocket Fuel Is Accused of Overstating Its Ability to Combat Fraudulent Internet Traffic
According to the complaint, shares of Rocket Fuel dropped 30% to close at $17.05 on August 6, 2014, following an announcement on August 5, 2014, that Rocket Fuel would be drastically lowering their full-year 2014 revenue guidance due to customer concern about inventory quality resulting from the inability to identify and eliminate fraudulent and “bot” traffic. This stands in stark contrast to Rocket Fuel’s previous boast about its ability to “undermine fraudulent practices and make sure con artists always leave empty handed…. Rocket Fuel is able to identify and eliminate all threats before serving a single ad.”
The complaint further alleges Rocket Fuel understated the gravity of ad fraud, specifically the threat that fraudulent ad traffic posed on the company’s current and future financial performance. Defendants failed to adequately disclose this threat with the U.S. Securities Exchange Commission in a way that would have warned investors about the issue.
Rocket Fuel 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.