A lawsuit has been filed against US firm Sunglass Hut International Inc. and certain officers on behalf of shareholders, alleging violations of US securities law, the plaintiffs“ lawyers said on 24 J…
A lawsuit has been filed against US firm Sunglass Hut International Inc. and certain officers on behalf of shareholders, alleging violations of US securities law, the plaintiffs“ lawyers said on 24 January. The class action suit was filed on behalf of all those who purchased or otherwise acquired the securities of Sunglass Hut between 21 March 1996 and 10 October 1996. According to the complaint, Sunglass made numerous announcements during the period concerning Sunglass“s alleged financial success, rapidly expanding sales and other positive indications. Plaintiffs allege that these statements made Sunglass“s stock price rise and were materially false and misleading because they failed to disclose an alleged series of problems relating to its allegedly expanding inventories, deteriorating sales, and limited product offerings. The complaint further claimed that, while these alleged problems were concealed from the investing public, certain Sunglass officers and directors sold over US$ 5 million worth of their Sunglass Hut stock holdings at or near its highest price during the period. Shares in sunglass companies have recently recovered, boosted by a ratings upgrade for Sunglass Hut International Inc. by Montgomery Securities analyst Alice Ruth, who raised the retailer“s rating to buy from hold. Analysts and traders said Sunglass Hut“s rise helped pull up other shares in the industry including Italy“s Luxottica Group and Oakley Inc. of the United States. All three sunglass companies had previously seen their stocks sliding since spring 1996.