CASES
Equinix, Inc.
Class Period: Jul 29, 2010 to Oct 5, 2010
Lead Plaintiff Deadline: May 4, 2011 + Deadline passed
Summary of Case:
A securities class action has been filed against Equinix, Inc. (EQIX) ("Equinix" or the "Company") on behalf of all securities purchasers from July 29, 2010 through October 5, 2010, inclusive ("Class Period") in the United States District Court for the Northern District of California.
The complaint alleges that defendants issued materially false and misleading statements regarding Equinix's business and financial results. Specifically, defendants failed to disclose that Equinix was having difficulty with the integration of Switch & Data Corporation Facilities Company (acquired in April 2010) into its operations due to a decline in bookings prior to the close of the acquisition and due to the Company's aggressive synergy plan. Defendants further continuously hyped demand for the Company's colocation services as being robust and failed to disclose that the Company's business model was not working and was causing the Company to experience increased churn and pricing pressure on its colocation services. As a result of defendants' false statements, Equinix's stock traded at artificially inflated prices during the Class Period, reaching a high of $105.09 per share on October 5, 2010.
After the market closed on October 5, 2010, Equinix issued a press release announcing revised third quarter and fiscal year 2010 guidance. The Company reported it expected revenue to be in the range of $328.0 to $330.0 million for the third quarter of 2010. The Company further reported it expected revenues for the full year 2010 to be approximately $1,215.0 million, 1.2% lower than the midpoint of its previous outlook. In addition, the Company announced that it would transition from a demand fulfillment business model to a demand creation model. On this news, Equinix's stock collapsed $34.75 per share to close at $70.34 per share on October 6, 2010, a one-day decline of over 33% on high 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.