Robbins Arroyo LLP: Orbital ATK, Inc. (OA) Misled Shareholders According to a Recently Filed Class Action
Robbins Arroyo LLP announces that a class action complaint was filed against Orbital ATK, Inc. (NYSE: OA) in the U.S. District Court for the Eastern District of Virginia. The complaint is brought on behalf of all purchasers of Orbital securities between June 1, 2015 and August 9, 2016, for alleged violations of the Securities Exchange Act of 1934 by Orbital’s officers and directors. Orbital develops and produces aerospace, defense, and aviation-related products to the United States government, allied nations, prime contractors, and other customers in the United States and internationally.
Orbital Accused of Implementing Ineffective Controls Over Financial Reporting
According to the complaint, in September 2012, Orbital entered into a $2.3 billion long-term contract with the U.S. Army to manufacture and supply small caliber ammunition at the U.S. Army’s Lake City Army Ammunition Plant (the “Contract”). Throughout the class period, Orbital submitted several filings with the U.S. Securities and Exchange Commission stating that the financial information was accurate and disclosed any material changes to the company’s internal control over financial reporting. However, the complaint alleges that Orbital officials failed to disclose that Orbital lacked effective control over financial reporting, and, as a result, the company failed to record an anticipated loss on the Contract after the loss became evident in 2015, as required by generally accepted accounting principles.
On August 10, 2016, Orbital announced that the company would not meet its Form 10-Q filing deadline for its most recent quarter, and that the company’s previously issued financial statements for fiscal 2015, among other periods, should no longer be relied upon. Orbital further stated that it identified misstatements related to the Contract, which it believes will result in a net loss over its ten-year term. The company admitted that the misstatements indicate the existence of one or more material weaknesses in its internal control over financial reporting and disclosure controls and procedures. On this news, Orbital’s share price fell $17.98 per share, or over 20%, to close at $70.79 per share on August 10, 2016.
Orbital 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