Robbins LLP: Flotek Industries, Inc. (FTK) Misled Shareholders According to a Recently Filed Class Action
Robbins LLP announces that a class action complaint was filed in the U.S. District Court for the Southern District of Texas. The complaint alleges that officers and directors of Flotek Industries, Inc. (NYSE: FTK) violated the Securities Exchange Act of 1934 between October 23, 2014 and November 9, 2015, by making materially false and misleading statements about Flotek’s business prospects. Flotek develops and supplies oilfield products, services, and equipment to the oil, gas, and mining industries in the United States and internationally. Flotek designed FracMax, a patent-pending mobile application that presents analytical data for hydraulically fractured wells across the United States.
Flotek Accused of Issuing Misleading Information About FracMax
According to the complaint, during 2014 and 2015, Flotek filed several Form 10-Qs and a Form 10-K with the U.S. Securities and Exchange Commission (“SEC”) attesting to the efficacy of FracMax. The company touted FracMax in multiple filings, stating, “The Company plans to continue to expand the capabilities and use of its patent pending FracMax software which will continue to enhance the Company’s sales and marketing efforts by validating the production and economic benefits of the company’s core Complex nano-Fluid chemistries.” On September 11, 2015, the company gave an investor presentation, which included production data of four proximate wells in Texas from the FracMax database that purportedly came directly from the Texas Railroad Commission.
However, on November 9, 2015, Australian analyst firm Bronte Capital published a report on Flotek asserting that the production data of the wells in the investor presentation did not match the data in the Texas Railroad Commission, and that a version of FracMax in the Apple iTunes store did not work. Then, on November 10, 2015, the company issued a press release acknowledging the data and process errors in the FracMax database and the understatement of production data in its investor presentation. On this news, Flotek stock fell $5.56 per share, or over 38%, to close at $9.04 per share on November 10, 2015.
Flotek 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.