Securities Litigation
Certain of the Companys current and former officers and directors have been named in shareholder derivative lawsuits. On October 29, 2018, a
shareholder filed a putative derivative complaint,
Streicher v. Polk, et al
., in the United States District Court for the District of Delaware (the
Streicher
Derivative Action), purportedly on behalf of the Company against
certain of our current and former officers and directors. On October 30, 2018, another shareholder filed a putative derivative complaint,
Martindale v. Polk, et al
., in the United States District Court for the District of Delaware (the
Martindale
Derivative Action), asserting substantially similar claims purportedly on behalf of the Company against the same defendants. The complaints allege, among other things, violations of the federal securities laws, breaches
of fiduciary duties, unjust enrichment, and waste of corporate assets. The factual allegations underlying these claims are similar to the factual allegations made in the
In re Newell Brands, Inc. Securities Litigation
pending in the United
States District Court for the District of New Jersey, further described below. The complaints seek unspecified damages and restitution for the Company from the individual defendants, the payment of costs and attorneys fees, and that the
Company be directed to reform certain governance and internal procedures.
The Company and certain of its current and former officers and directors have
been named as defendants in a putative securities class action lawsuit filed in the Superior Court of New Jersey, Hudson County, on behalf of all persons who acquired Company common stock pursuant or traceable to the
S-4
registration statement and prospectus issued in connection with the April 2016 acquisition of Jarden (the Registration Statement). The action was filed on September 6, 2018, and is
captioned
Oklahoma Firefighters Pension and Retirement System v. Newell Brands Inc., et al.
, Civil Action No.
HUD-L-003492-18.
The complaint alleges certain violations of the securities laws, including, among other things, that the
defendants made certain materially false and misleading statements and omissions in the Registration Statement regarding the Companys financial results, trends, and metrics. The plaintiff seeks compensatory damages and attorneys fees and
costs, among other relief, but has not specified the amount of damages being sought. The Company intends to defend the litigation vigorously.
The Company
and certain of its officers have been named as defendants in two putative securities class action lawsuits, each filed in the United States District Court for the District of New Jersey, on behalf of all persons who purchased or otherwise acquired
our common stock between February 6, 2017 and January 24, 2018. The first lawsuit was filed on June 21, 2018 and is captioned
Bucks County Employees Retirement Fund, Individually and on behalf of All Others Similarly Situated v.
Newell Brands Inc., Michael B. Polk, Ralph J. Nicoletti, and James L. Cunningham, III
, Civil Action No.
2:18-cv-10878.
The second lawsuit was filed on June 27,
2018 and is captioned
Matthew Barnett, Individually and on Behalf of All Others Similarly Situated v. Newell Brands Inc., Michael B. Polk, Ralph J. Nicoletti, and James L. Cunningham, III
, Civil Action No.
2:18-cv-11132.
On September 27, 2018, the court consolidated these two cases under Civil Action No.
18-cv-10878
(JMV)(JBC)
bearing the caption
In re Newell Brands, Inc. Securities Litigation
. The court also named Hampshire County Council Pension Fund as the lead plaintiff in the consolidated case. The complaints allege certain violations of the securities laws,
including, among other things, that the defendants made certain materially false and misleading statements and omissions regarding the Companys business, operations, and prospects between February 6, 2017 and January 24, 2018. The
plaintiffs seek compensatory damages and attorneys fees and costs, among other relief, but have not specified the amount of damages being sought. The Company intends to defend the litigation vigorously.
Recall of Harness Buckles on Select Car Seats
In
February 2014, Graco Childrens Products, Inc. (Graco), a subsidiary of the Company, announced a voluntary recall in the U.S. of harness buckles used on approximately 4 million toddler car seats manufactured between 2006 and
2013. In July 2014, Graco announced that it had agreed to expand the recall to include certain infant car seats manufactured between July 2010 and May 2013. In December 2014, the National Highway Traffic Safety Administration (the NHTSA)
announced an investigation into the timeliness of the recall, and in March 2015, the investigation concluded with Graco entering into a consent order with NHTSA pursuant to which Graco committed to spend $7.0 million in total over a five-year
period to enhance child passenger safety and make a $3.0 million payment to NHTSA. At September 30, 2018, the amount remaining to be paid associated with the consent order was immaterial to the consolidated financial statements of the
Company.
Jarden Acquisition
Under the Delaware
General Corporation Law (DGCL), any Jarden stockholder who did not vote in favor of adoption of the Merger Agreement, and otherwise complies with the provisions of Section 262 of the DGCL, is entitled to seek an appraisal of his or
her shares of Jarden common stock by the Court of Chancery of the State of Delaware as provided under Section 262 of the DGCL. As of September 30, 2018, dissenting stockholders collectively holding approximately 2.9 million shares of
Jarden common stock have delivered (and not withdrawn) to Jarden written demands for appraisal. Two separate appraisal petitions, styled as
Dunham Monthly Distribution Fund v. Jarden Corporation
, Case
No. 12454-VCS
(Court of Chancery of the State of Delaware), and
Merion Capital LP v. Jarden Corporation
, Case
No. 12456-VCS
(Court of Chancery of the
State of Delaware), respectively, were filed on June 14, 2016 by a total of ten purported Jarden stockholders seeking an appraisal of the fair value of their shares of Jarden common stock pursuant to Section 262 of the DGCL. A third
appraisal petition,
Fir Tree Value Master Fund, LP v. Jarden Corporation
, Case
No. 12546-VCS
(Court of Chancery of the State of Delaware), was filed on July 8, 2016 by two purported Jarden
stockholders seeking an appraisal of
25