Ormat Technologies Class Action Lawsuit
Levi & Korsinsky, LLP
June 22, 2018
On June 11, 2018, investors sued Ormat Technologies, Inc., (“Ormat” or the “Company”) in United States District Court, District of Nevada. The federal securities class action alleges that the plaintiffs acquired Ormat stock at artificially inflated prices between August 8, 2017 and May 15, 2018 (the “Class Period”). They are now seeking compensation for financial losses incurred upon public revelation of the Company’s alleged misconduct during that time. Here’s what you need to know about the Ormat Technologies class action lawsuit (ORA class action lawsuit):
Summary of the Allegations
According to its website, Ormat (NYSE: ORA) designs, builds and supplies “power generating equipment” for “geothermal and recovered energy” power plants.
Established in 1965, the Company initially achieved recognition as “a pioneer of proprietary turbine designs, capable of generating electricity from low enthalpy energy resources.” As such, it focused its efforts on manufacturing power generation equipment. In the late 20th century, the Company shifted gears and “growing renewable energy expertise on the geothermal industry.”
Today, the Company says, it has customers in 30 countries. It also claims that it has gained “focused its global expertise in exploring, developing, designing, manufacturing, building, owning and operating geothermal power plants in Kenya, Guadalupe, Guatemala, Honduras and the United States.”
Summary of Facts
Ormat and two of its senior officers now stand accused of deceiving investors by lying and withholding critical information about the Company’s business practices during the Class Period.
Specifically, they are accused of omitting truthful information about certain accounting practices and errors, and about the efficacy of its internal controls over financial reporting, from SEC filings and related material. By knowingly or recklessly doing so, they allegedly caused Ormat stock to trade at artificially inflated prices during the time in question.
The truth first surfaced on May 11, when the Company revealed that it would be unable to meet the deadline for filing its Quarterly Report for the period that ended on March 31, 2018 with the SEC. The Company also blamed the discovery of “an error in the Company’s financial statement presentation of deterred income tax assets and deferred income tax liabilities that affects the Company’s balance sheets in previous reporting periods” for its inability to do so.
Less than a week later Ormat revealed that “it will restate its second, third and fourth quarter 2017 financial statements and its full-year 2017 financial statements.” Ormat also advised investors that they should no longer rely on the prior financial statements, earnings statements or related material for the specified periods.
A closer look…
As alleged in the June 11 complaint, the Company repeatedly made false and misleading statements in its SEC filings during the Class Period.
For example, on a form filed with the SEC on August 8, 2017, the Company stated that its “disclosure controls and procedures” were effective as of June 30, 2017. It also stated that “[t]here were no changes in our internal controls over financial reporting in the second quarter of 2017 that have materially affected or are reasonably likely to materially affect our internal controls over financial reporting.”
On the same form, Ormat included signed certifications in which the senior officers named in the suit affirmed the “accuracy of financial reporting, the disclosure of any material changes to the Company’s internal controls over financial reporting, and the disclosure of all fraud.”
The Company reiterated these statements and included signed certifications attesting to the same matters on two additional forms filed with the SEC during the Class Period.
Impact of the Alleged Fraud on Ormat’s Stock Price and Market Capitalization
|Closing stock price prior to disclosures:|
|Closing stock price the trading day after disclosures:|
|One day stock price decrease (percentage) as a result of disclosures:|
The following chart illustrates the stock price during the class period:
Actions You May Take
If you have purchased shares during the Class Period, you may join the class action as a lead plaintiff, remain a passive class member, or opt out of this litigation and pursue individual claims that may not be available to the class as a whole.
NOTE: The deadline to file for lead plaintiff in this class action is August 10, 2018. You must file an application to be appointed lead plaintiff prior to this deadline in order to be considered by the Court. Typically, the plaintiff or plaintiffs with the largest losses are appointed lead plaintiff.
In order to identify your potential exposure to the alleged fraud during the time in question, you may wish to perform an analysis of your transactions in Ormat common stock using court approved loss calculation methods.
Recently Filed Cases
Listed below are recently filed securities class action cases being monitored by us, along with the class period and the deadline to file a motion to be appointed as the Lead Plaintiff in the action. Please contact us if you would like an LK report for any of these cases:
|This information is provided for general information purposes only, and should not be construed as legal advice, nor does it establish an attorney-client relationship with Levi & Korsinsky LLP. Any and all information herein is simply an opinion based on publicly available information and should not necessarily be construed as fact. For more information, please visit our website at www.zlk.com.|
Levi & Korsinsky is a leading securities litigation firm with a hard-earned reputation for protecting investors’ rights and recovering losses arising from fraud, mismanagement and corporate abuse. With thirty attorneys and offices in New York, Connecticut, California and Washington D.C., the firm is able to litigate cases in various jurisdictions in the U.S., England, and in other international jurisdictions.
Levi & Korsinsky provides portfolio monitoring services for high-net worth investors and institutional clients. Our firm also assists investors in evaluating whether to opt-out of large securities class actions to pursue individual claims.
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