IEC Electronics Corp. Sued by Investor
Robbins LLP announces that a shareholder of IEC Electronics Corp. (NYSE: IEC) has filed a complaint in the U.S. District Court for the Southern District of New York. The complaint alleges that the company and certain of its officers and directors violated the Securities Exchange Act of 1934 between February 8, 2012 and May 21, 2013 (the “Class Period”).
IEC Accused of Making False and Misleading Statements
According to the complaint, IEC made false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and financial performance throughout the Class Period. Specifically, the complaint alleges that IEC made false and/or misleading statements and failed to disclose that the company was improperly accounting for work-in-process inventory for one of its subsidiaries, and, as a result, the company overstated its gross profit. The complaint further alleges that IEC’s financial results were not prepared in accordance with Generally Accepted Accounting Principles.
IEC Stock Price Drops on News of Financial Restatements and NYSE Delisting
According to the complaint, on May 1, 2013, IEC announced that it would be forced to restate its consolidated financial statements for its fiscal year ended September 30, 2012, the quarterly periods during fiscal year 2012, and its quarter ended December 28, 2012. Subsequently, on May 13, 2013, the company also announced that it would be unable to timely file its quarterly report on Form 10-Q with the U.S. Securities and Exchange Commission for its fiscal quarter ended March 29, 2013. Then, on May 20, 2013, IEC announced that, during its review of the restatement, the Board of Directors’ Audit Committee determined that further review is necessary before the company’s financial statements can be filed. Finally, on May 21, 2013, IEC announced that it received a notice of delisting of its securities from the NYSE as a result of failure to timely file the aforementioned quarterly report. As this news reached the public during the month of May, IEC’s stock price declined a total of $2.18, or 38%, to close on May 21, 2013, at $3.52 per share.
If you invested in IEC and would like to discuss your shareholder rights, please contact attorney Darnell R. Donahue at (800) 350-6003 or you can complete the form below and we will contact you directly.