Robbins Arroyo LLP: Embraer S.A. (ERJ) Misled Shareholders According to a Recently Filed Class Action
Robbins Arroyo LLP announces that a class action complaint was filed against Embraer S.A. (NYSE: ERJ) in the U.S. District Court for the Southern District of New York. The complaint is brought on behalf of all purchasers of Embraer securities between April 16, 2012 and July 28, 2016, for alleged violations of the Securities Exchange Act of 1934 by Embraer’s officers and directors. Embraer designs, develops, manufactures, and sells aircraft and systems in Brazil, North America, Latin America, the Asia Pacific, Europe, and internationally.
Embraer Accused of Hiding Bribery Scheme From Investors
According to the complaint, throughout the class period, Embraer submitted several filings with the U.S. Securities and Exchange Commission (“SEC”) certifying that the financial information was accurate and disclosed any material changes to the company’s internal control over financial reporting. The complaint alleges, however, that Embraer officials failed to disclose that: (i) the company had paid bribes to officials in the Dominican Republic to secure contracts for the sale of aircraft; (ii) Embraer’s President and Chief Executive Officer (“CEO”) was aware of the bribery scheme; and (iii) the foreseeable consequences of the foregoing conduct would cost Embraer hundreds of millions of dollars.
On September 23, 2014, The Wall Street Journal reported that Brazilian authorities filed bribery charges against eight Embraer employees, claiming that they had bribed officials in the Dominican Republic to secure a $92 million contract. On March 16, 2016, various media outlets reported that a sales consultant who purportedly paid bribes on behalf of Embraer told Brazilian prosecutors that he believed the company’s top managers, including the CEO, knew of the illicit payments made in connection with the Dominican Republic sales. Embraer then announced on June 9, 2016, that its CEO was stepping down after 32 years with the company. On July 29, 2016, Embraer revealed that it was recognizing a $200 million loss contingency in the quarter ended June 30, 2016, reflecting the likely outcome of investigations by the U.S. Department of Justice and the SEC. In addition, Embraer reported a net loss for the quarter of $99.4 million. Since news of Embraer’s troubles became public, its stock declined over 38% to close at $18.27 per share on July 29, 2016.
Embraer 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.
Send This Post