Robbins Arroyo LLP: Sunrun Inc. (RUN) Misled Shareholders According to a Recently Filed Class Action
Shareholder rights law firm Robbins Arroyo LLP announces that a class action complaint was filed against Sunrun Inc. (NASDAQGS: RUN) in the U.S. District Court for the Northern District of California. The plaintiff brings the complaint on behalf of all purchasers of Sunrun securities pursuant to Sunrun’s August 5, 2015 initial public stock offering (“IPO”) for alleged violations of the Securities Act of 1933. Sunrun engages in the design, development, installation sale, ownership, and maintenance of residential solar energy systems in the United States.
Sunrun Accused of Overcharging Its Customers
According to the complaint, on August 5, 2015, Sunrun priced its IPO at $14.00 per share, selling 17.9 million shares of Sunrun common stock and raising $250.6 million in gross proceeds. The complaint alleges that the registration statement filed in connection with Sunrun’s IPO was misleading because the company claimed to provide homeowners with predictable pricing for solar energy that is insulated from rising retail electricity prices and emphasized that it sold customer-friendly solar service offerings with customized configurations and pricing. However, the complaint alleges that the company was charging well above wholesale rates to its solar customers and was suffering from negative perceptions as customers learned the true facts.
The registration statement further claimed that Sunrun receives 20 years of predicable cash flows from its 20-year contracts with its customers, when in reality the company’s net metering policies were under intense regulatory scrutiny and likely to make it difficult for Sunrun to get customers to agree to sign 20-year contracts. Sunrun stated it focused its resources on markets with favorable policy environments, when it actually had committed immense resources to Nevada, where net metering was being attacked in the Nevada Public Utilities Commission. On January 7, 2016, Sunrun admitted it was ceasing all operations in Nevada and that residential solar growth would consequently decline from 76% in 2015 to just 40% in 2016. Sunrun’s stock price has since plummeted and now trades at $7.33 per share, or about 50% of the price the stock was sold at in the IPO.
Sunrun 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.