NEW YORK, April 17, 2022 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, reminds investors that class actions have been commenced on behalf of stockholders of TaskUs, Inc. (NASDAQ: TASK), Gatos Silver, Inc. (NYSE: GATO), MP Materials Corp. (NYSE: MP), and Cerence, Inc. (NASDAQ: CRNC). Stockholders have until the deadlines below to petition the court to serve as lead plaintiff. Additional information about each case can be found at the link provided.
TaskUs, Inc. (NASDAQ: TASK)
Class Period: June 11, 2021 – January 19, 2022
Lead Plaintiff Deadline: April 25, 2022
The complaint alleges that throughout the Class Period, Defendants claimed that TaskUs had “industry-leading growth and profitability” and a “simply massive” market opportunity. The complaint further alleges that Defendants touted the size of the Company's workforce and “low employee attrition levels” which “leads to lower hiring and training costs.”
These statements were materially false and misleading. On January 20, 2022, Spruce Point Capital Management, LLC (“Spruce Point”) issued a report titled “Moderating the Bull Case Content” based on its “forensic financial and accounting review” of TaskUs. Spruce Point found that TaskUs, “has a pattern of exaggerated and inflated business claims, including revenue, and is covering-up financial strain with reduced disclosures, cherry-picked market data, and non-standard key performance metrics.” Additionally, Spruce Point stated, “we find evidence of increasing strain in the relationship" between TaskUs and its largest customer Facebook “and believe margins and cash flow are set to contract more than expected.” Spruce Point also stated, “we find a pattern of [TaskUs] embellishing the size of its workforce and making overly optimistic revenue growth claims.”
This disclosure caused the value of TaskUs stock to decline dramatically, resulting in significant harm to investors.
For more information on the TaskUs class action go to: https://bespc.com/cases/TASK
Gatos Silver, Inc. (NYSE: GATO)
Class Period: October 28, 2020 IPO; October 28, 2020 – January 25, 2022
Lead Plaintiff Deadline: April 25, 2022
The litigation focuses on Gatos’ statements concerning its Cerro Los Gatos (“CLG”) mine located in Chihuahua, Mexico, including the Company’s estimates in its July 1, 2020 Technical Report (“2020 Technical Report”) that the CLG deposit “contains approximately 9.6 million diluted tonnes of proven and probable mineral reserves.”
According to the complaint, defendants made materially false and misleading statements and failed to disclose material adverse facts, including: (1) that the 2020 Technical Report contained errors; and (2) that, among other things, the GLG mineral reserves had been overestimated by as much as 50%.
The truth came to light on Jan. 25, 2022, when Gatos disclosed that during a resource and reserve update process, which included a detailed reconciliation of recent production performance, the Company concluded that there were errors in the 2020 Technical Report, as well as indications that there is an overestimation in the existing resource model. As a result, the Company estimated a potential reduction of the metal content of CLG mineral reserve ranging from 30% to 50% of the metal content and warned that the mineral resource and reserve estimates in the 2020 Technical Report should not be relied upon.
This revelation drove the price of Gatos shares as much as 70% lower on January 26, 2022.
For more information on the Gatos class action go to: https://bespc.com/cases/GATO
MP Materials Corp. (NYSE: MP)
Class Period: May 1, 2020 – February 2, 2022
Lead Plaintiff Deadline: April 25, 2022
A class action has commenced on behalf of certain shareholders in MP Materials Corp f/k/a Fortress Value Acquisition Corp. The filed complaint alleges that defendants made materially false and/or misleading statements and/or failed to disclose that: (i) Fortress Value Acquisition Corp. (“FVAC”) had overstated its due diligence efforts and expertise with respect to identifying target companies to acquire; (ii) FVAC performed inadequate due diligence into Legacy MP Materials prior to the business combination, or else ignored significant red flags regarding, inter alia, Legacy MP Materials’ management, compliance policies, and Mountain Pass’s profitability; (iii) as a result, the Company’s future business and financial prospects post-business combination were overstated; (iv) MP Materials engaged in an abusive transfer price manipulation scheme with a related party in the People’s Republic of China to artificially inflate the Company’s profits; (v) MP Materials' ore at the Mountain Pass Rare Earth Mine and Processing Facility was not economically viable to harvest for rare earth metals; and (vi) as a result, the Company's public statements were materially false and misleading at all relevant times.
For more information on the MP Materials class action go to: https://bespc.com/cases/MP
Cerence, Inc. (NASDAQ: CRNC)
Class Period: February 8, 2021 – February 4, 2022
Lead Plaintiff Deadline: April 26, 2022
Cerence is a Burlington, Massachusetts-based company that focuses on building artificial intelligence-powered virtual assistants primarily for the automotive market. Despite the ongoing COVID-19 pandemic, supply-chain issues, and the semiconductor shortage, which reduced the global production of automobiles, Cerence continued to report growing revenues and strong demand for software licenses for its products. Cerence even touted its “visibility” into demand for its products by providing revenue guidance for fiscal year 2024, guidance that was a focus of securities analysts and that the Company raised significantly during the Class Period.
The Class Action alleges that, during the Class Period, Defendants made materially false and misleading statements and failed to disclose material adverse facts about the Company’s business, operations, and prospects in violation of the Exchange Act and SEC Rule 10b-5. Specifically, Defendants failed to disclose: (1) that the global semiconductor shortage had a materially negative impact on demand for Cerence’s software licenses; (2) that Defendants masked the impact of the semiconductor shortage on demand for the Company’s software licenses by pulling forward sales; and (3) that, as a result of the above, Defendants’ statements about Cerence’s business, operations, and prospects were false and misleading and/or lacked a reasonable basis.
The truth began to emerge during Cerence’s earnings call on November 22, 2021 for the fiscal fourth quarter of 2021 ended on September 30, 2021, causing Cerence’s stock price to fall and investors to suffer substantial losses. On that call, Cerence announced revenue guidance for fiscal year 2022 that was well below analysts’ expectations. In response to this revelation, Cerence’s stock price fell more than 20 percent from a closing price of $104.06 the prior trading day, to a close of $82.59 on November 22, 2021. The Company’s stock price continued to fall another 5% the following day to close at $78.27 on November 23, 2021.
Then, approximately three weeks later, Cerence’s Chief Executive Officer (“CEO”) Sanjay Dhawan abruptly resigned. On this news, Cerence’s stock price fell an additional 11% from a closing price of $78.08 on December 14, 2021 to a closing price of $69.20 on December 15, 2021.
Finally, on February 7, 2022, the Company announced results for its fiscal first quarter of 2022 ended on December 31, 2021 and shocked the market with three disclosures. First, the Company announced that Chief Financial Officer Mark Gallenberger would be retiring, effective March 11, 2022. Next, during its earnings conference call, new CEO Stefan Ortmanns announced he had conducted a review of each of the Cerence business units’ plans, forecasts, and assumptions, and determined the “conversion from bookings to revenue will take longer than expected.” As a result, Cerence was forced to lower its fiscal year 2022 guidance, only a few months after providing disappointing guidance for the same period. Finally, Cerence completely withdrew the closely watched fiscal year 2024 guidance. On this news, Cerence’s stock price fell an additional 30%, from a closing price of $63.58 on the prior trading day of February 4, 2022, to close at $43.61 on February 7, 2022.
For more information on the Cerence class action go to: https://bespc.com/cases/CRNC
About Bragar Eagel & Squire, P.C.:
Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.
Contact Information:
Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Alexandra B. Raymond, Esq.
(212) 355-4648
investigations@bespc.com
www.bespc.com
