Liquidity Services Executives Under Investigation for False Statements
Schubert Jonckheer & Kolbe LLP has launched an investigation into whether certain officers and directors of Liquidity Services, Inc. (LQDT) breached their fiduciary duties by issuing false and misleading statements to shareholders and the market. Liquidity Services is an online auction marketplace for surplus and salvage assets.
On March 31, 2016, the United States District Court for the District of Columbia upheld securities fraud class action claims against Liquidity Services and certain of its officers and directors. The class action alleges that during the period February 1, 2012 through May 7, 2014, the defendants misrepresented the true condition of the company’s business. Specifically, defendants are alleged to have made false and misleading statements regarding the purported strength of the company’s retail and commercial capital assets divisions, causing the stock price to be artificially inflated. In addition, the class action alleges that Liquidity Services’ CEO sold $68.2 million of company stock at artificially inflated prices while the false and misleading statements were being made. Based on the allegations in the class action, the Court found that there was a “strong and cogent inference of scienter,” or intent to defraud.
Schubert Jonckheer & Kolbe's investigation concerns when and how much certain of Liquidity Services’ officers and directors knew or should have known of the false and misleading statements, and whether any corporate insider sold stock based on non-public information. Shareholders interested in seeking the recovery of damages on behalf of the company and securing other remedial measures should contact the firm.
If you are a long-term holder of Liquidity Services stock and wish to obtain additional information about Schubert Jonckheer & Kolbe's investigation and your legal rights, please contact Dustin Schubert either via email at dschubert@schubertlawfirm.com or by telephone at (415) 788-4220, or fill out the form (at right).
