Robbins LLP is Investigating Allegations that TMC the metals company Inc. (TMC) Failed to Disclose its Deficient Internal Controls Over Financial Reporting

Robbins LLP announces that a shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired TMC the metals company Inc. (NASDAQ: TMC) securities between May 12, 2023 and March 25, 2024. TMC is a deep-sea minerals exploration company focused on the collection, processing, and refining of polymetallic nodules.

The Allegations

According to the complaint, during the class period, defendants failed to disclose that: (i) TMC maintained deficient internal controls over financial reporting; (ii) as a result, the Company inaccurately classified the sale of future revenue attributable to the LCR Partnership as deferred income rather than debt; and (iii) the foregoing misclassification, when it became known, would require TMC to restate one or more of its previously issued financial statements.

Plaintiff alleges that on March 25, 2024, TMC disclosed in a filing with the SEC that the Company’s financial statements for the first three quarters of 2023 “should be restated and, accordingly, should no longer be relied upon”, citing the “re-evaluat[ion of] whether the offsetting entry to the proceeds it received from LCR should be classified as debt or deferred income.”  Further, TMC explained that, “[a]s the transaction with LCR was considered an equity investment rather than a sale transaction, the sale of future revenue will be reclassified as Royalty liability” per appropriate accounting standards.   On this news, TMC’s stock price fell $0.205 per share, or 13.23%, to close at $1.345 per share on March 26, 2024.

What Now: You may be eligible to participate in the class action against TMC the metals company Inc. Shareholders who want to serve as lead plaintiff for the class must submit their application to the court by January 7, 2025. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation.  You do not have to participate in the case to be eligible for a recovery. If you choose to take no action, you can remain an absent class member.

All representation is on a contingency fee basis. Shareholders pay no fees or expenses.