Labaton Sucharow LLP Files Class Action Lawsuit on Behalf of Xerox Corporation Investors
October 24 2016 - 5:35PM
Labaton Sucharow LLP (“Labaton Sucharow”) announces that on October
21, 2016, it filed a securities class action lawsuit on behalf of
its client Oklahoma Firefighters Pension and Retirement System
(“Oklahoma Fire”) against Xerox Corporation (“Xerox” or the
“Company”) (NYSE:XRX), and certain of its senior executives
(collectively, “Defendants”). The action, which is captioned
Oklahoma Firefighters Pension and Retirement System v. Xerox
Corporation, No. 16-cv-08260 (S.D.N.Y.), asserts claims under
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
(the “Exchange Act”), and U.S. Securities and Exchange Commission
(“SEC”) Rule 10b-5 promulgated thereunder, on behalf of all persons
or entities who purchased or otherwise acquired Xerox common stock
between April 23, 2012 and October 23, 2015, inclusive (the “Class
Period”).
The Complaint alleges that during the Class Period, Defendants
violated provisions of the Exchange Act by issuing false and
misleading statements regarding the profitability and growth
prospects of an important software product called Health
Enterprise—designed to assist state agencies administer their
respective Medicaid programs. Xerox is a global provider of
document processing services and printing machines. Beginning
in 2009, as the Company’s hardware products became less profitable,
Xerox embarked on a new corporate strategy to transition into more
of a computer services-related company. As part of Xerox’s
computer services transition strategy, the Company acquired
Affiliated Computer Services, Inc. for $6.4 billion in February
2010. Through the acquisition, Xerox took over the Health
Enterprise product, which provides software solutions for states to
manage all aspects of their contemporary Medicaid programs and to
do so in accordance with government rules and regulations.
During the Class Period, Xerox repeatedly touted the Health
Enterprise business as an important growth area for the Company,
which would operate at low cost and high profit margin.
However, Defendants’ Class Period statements pertaining to the
profitability and growth prospects of the Health Enterprise
business were materially false and misleading because Defendants
failed to disclose that: (1) the Company’s existing Health
Enterprise projects were experiencing major delays and cost
overruns; (2) the Company would be unable to deliver Health
Enterprise implementations at sustainable profits; and (3) as a
result, the Company’s positive statements about its business,
operations, and prospects lacked a reasonable
basis.
Beginning in late 2014, this truth began to be revealed in a
series of disclosures that exposed implementation delays, cost
overruns, and customer disputes. Finally, in October 2015,
two key state agencies terminated Health Enterprise contracts with
Xerox. By then, Xerox had taken more than $500 million in
related asset write-downs. In reaction to these revelations,
Xerox’s stock lost hundreds of millions of dollars in market
capitalization, with the Company’s stock price falling from a Class
Period closing high of $13.57 per share on December 5, 2014, to
close at $9.01 per share on October 27, 2015.
If you purchased or acquired the publicly traded common stock of
Xerox during the Class Period, you are a member of the “Class” and
may be able to seek appointment as Lead Plaintiff. Lead
Plaintiff motion papers must be filed with the U.S. District Court
for the Southern District of New York no later than December 23,
2016. The Lead Plaintiff is a court-appointed representative
for absent members of the Class. You 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.
If you would like to consider serving as Lead Plaintiff or have
any questions about this lawsuit, you may contact Francis P.
McConville, Esq. of Labaton Sucharow, at (800) 321-0476, or via
email at fmcconville@labaton.com. You can view a copy of the
complaint online at
http://www.labaton.com/en/cases/Oklahoma-Firefighters-Pension-and-Retirement-System-v-Xerox-Corporation.cfm?cs_forceReadMode=1
Oklahoma Fire is represented by Labaton Sucharow, which
represents many of the largest pension funds in the United States
and internationally with collective assets under management of more
than $2 trillion. Labaton Sucharow’s litigation reputation is
built on its half-century of securities litigation experience, 60
full-time attorneys, and in-house team of investigators, financial
analysts, and forensic accountants. Labaton Sucharow has been
recognized for its excellence by the courts and peers, and it is
consistently ranked in leading industry publications. Offices
are located in New York, NY and Wilmington, DE. More
information about Labaton Sucharow is available at
www.labaton.com.
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