WASHINGTON, DC (March 3, 2018) — U.S. Market Advisors Law Group PLLC announces that a securities class action has been filed against Ubiquiti Networks, Inc. (“Ubiquiti”) (NASDAQ: UBNT). The class action is on behalf of investors who acquired Ubiquiti securities between May 9, 2013 and February 20, 2018.
Investors with losses have until April 23, 2018 to ask the Court to be appointed as Lead Plaintiff for the class. The Lead Plaintiff is a representative for absent members of the class. Investors do not need to seek appointment as Lead Plaintiff to share in any class recovery in this action. If you are a class member and there is a recovery for the class, you can share in that recovery as an absent class member. You may retain counsel of your choice to represent you in this action. Contact USMA Law Group to discuss this action.
Ubiquiti develops technology platforms for high-capacity distributed Internet access, unified information technology, and next-generation consumer electronics for home and personal use. The Company does not employ a traditional sales force. Instead, it purports to “drive brand awareness largely through the company’s user community where customers can interface directly with R&D, marketing, and support.” The Company calls this user community the “Ubiquiti Community.”
Allegations Against Ubiquiti
According to the lawsuit, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Ubiquiti had overstated the numbers of members of its purported user community; (ii) Ubiquiti had exaggerated its publicly reported accounts receivable; (iii) the foregoing conduct, when it came to light, would foreseeably result in increased regulatory oversight; and (iv) as a result of the foregoing, Ubiquiti’s publicly disseminated financial statements were materially false and misleading.
On September 18, 2017, Citron Research (“Citron”) issued a report entitled “Citron Exposes Ubiquiti Networks,” (the “Citron Report”) in which Citron detailed a series of “alarming red flags,” indicating that the Company has been deceiving investors and is engaged in “corporate fraud,” including, among other things, that the Company has misrepresented the size of its purported “Ubiquiti Community”, as well as its levels of accounts receivable, among other things.
On this news, Ubiquiti’s share price fell nearly 8% to close at $50.62 on September 18, 2017. [Price bounced back nearly immediately]
On February 20, 2018, Ubiquiti issued a Current Report, filed on Form 8-K with the SEC, revealing that the Company had received subpoenas from the Securities and Exchange Commission “requesting documents and information relating to a range of topics including metrics relating to the Ubiquiti Community, accounting practices, financial information, auditors, international trade practices, and relationships with distributors and various other third parties.”
On the news of the SEC subpoenas, Ubiquiti’s share price fell $18.76, or 25.34%, to close at $55.28 on February 20, 2018, damaging investors.
About USMA Law Group
U.S. Market Advisors Law Group PLLC is a national law firm based in Washington, D.C. The firm represents investors worldwide in U.S. securities class action lawsuits.
David P. Abel