Robbins LLP: Straight Path Communications, Inc. (STRP) 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 District of New Jersey. The complaint alleges that officers and directors of Straight Path Communications, Inc. (NYSE: STRP) violated the Securities Exchange Act of 1934 between October 29, 2013 and November 5, 2015, by making materially false and misleading statements about Straight Path’s business prospects. Straight Path, through its subsidiaries, holds, leases, and markets fixed wireless spectrum licenses in the United States.
Straight Path Accused of Issuing Misleading Information
According to the complaint, from 2013 to 2015, Straight Path filed several Form 10-Qs and Form 10-Ks with the U.S. Securities and Exchange Commission (“SEC”) attesting to the accuracy of the financial information presented and acknowledging that all fraud was disclosed. In these filings, Straight Path stated, “We believe, and the Federal Communications Commission’s (“FCC”) actions bolster our belief, that our spectrum will be a critical element of mobile broadband in the foreseeable future.” However, the complaint alleges that these filings were misleading because Straight Path failed to disclose that the commercialibility of its spectrum assets was less than touted, and Straight Path’s spectrum licenses were improperly obtained.
On October 29, 2015, Kerrisdale Capital published a report that questioned the commercial viability of Straight Path’s spectrum licenses. On this news, Straight Path’s stock fell $18.23 per share, or over 38%, to close at $29.35 per share on October 29, 2015. Then, on November 5, 2015, Sinclair Upton Research published a report asserting that the company’s licenses for the 39 Gigahertz wireless sites were renewed only after the company made fraudulent representations to the FCC. On this news, the company’s stock fell $13.70 per share, or nearly 52%, to close at $12.81 per share on November 5, 2015.
Straight Path 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.