CASES
NBTY, Inc. (2010)
Class Period: Nov 9, 2009 to Apr 26, 2010
Lead Plaintiff Deadline: Jul 12, 2010 + Deadline passed
Summary of Case:
A securities class action has been filed against NBTY, Inc. ("NBTY" or the "Company") on behalf of all securities purchasers from November 9, 2009 through April 26, 2010, inclusive ("Class Period"), in the United States District Court for the Eastern District of New York.
The complaint alleges that throughout the Class Period, defendants failed to disclose material adverse facts about NBTY's true financial condition, business and prospects. Specifically, defendants failed to disclose: (i) that the Company was experiencing a significant disruption in its private label business and a related decrease in demand for its private label products; (ii) that the Company's advertising costs were escalating far in excess of the Company's internal forecasts; and (iii) as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about the Company and its prospects. On April 27, 2010, the Company issued a press release announcing its financial results for the fiscal second quarter of 2010, the period ended March 31, 2010. The Company announced that its private label sales accounted for only 38% of wholesale sales in the fiscal second quarter of 2010, compared to 42% of wholesale sales in the fiscal second quarter of 2009 - a decline of 4%. Moreover, according to the press release, net income was "adversely affected by the Company's increased television advertising to support its Nature's Bounty, Osteo Bi Flex, Ester C and Pure Protein brands. In response to the unexpected rise in advertising costs and a slowdown of sales in its private label business, shares of the Company's stock fell $9.66 per share, or 21%, to close at $37.24 per share, on unusually heavy trading volume.
If you purchased this company's shares during the Class Period and suffered a loss or for further information about the case, please review the links below.