The Law Offices Bernard M. Gross, P.C. started the shareholder lawsuit train against GT Advanced Technologies (GTAT) on Monday. Attorneys at the firm are seeking a lead plaintiff for the case, which accuses executives, directors, and underwriters of misleading investors in the wake of the company's fallout with Apple.
"If you wish to serve as Lead Plaintiff for the Class, you must file a motion with the Court no later than December 8, 2014," the firm said in a statement.
GTAT filed for bankruptcy protection on October 6th, a few weeks after Apple launched the iPhone 6 and iPhone 6 Plus without sapphire displays. Shares plummeted to less than a dollar per share on the news, and in filings before the court, GTAT has complained the Apple's agreements were "oppressive and burdensome." Any response from Apple about such claims have so far gone unreported.
The suit alleges that, "defendants misrepresented and/or concealed GT's cash position, expected cash position and revenues, ability to meet the milestones under a critical agreement with Apple for the production of sapphire material, and the progress that the Company was making developing the facility that would produce the sapphire material."
The attorneys mentioned in the press release that GTAT CEO Tom Guittierez sold some 9,232 shares of his company's stock the day before Apple released the iPhone 6. In a statement issued last week, GTAT said that sale was registered back in March.
All in all, shares of $GTAT have plummeted from more than US$17 per share before the launch of the iPhone 6 to $0.3971 as of this writing, a loss in value of 97.7 percent. Shareholder lawsuits are common in the wake of such collapses. Class actions filed by attorneys without a plaintiff are somewhat common, too.
Full disclosure: The author of this piece has been long on $AAPL with a tiny holding for more than a decade. The author also picked up a few shares of $GTAT (as a pure gamble) when that stock collapsed following the bankruptcy announcement, outside the time frame of that suit. None of the author's minuscule stock holdings amount to much in the way of total assets, nor were they in any way an influence on the writing of this, or any article about any company.