Frontier Communications Corp. Securities Litigation
|Court:||Federal District Court of the District of Connecticut|
|Judge:||Hon. Victor A. Bolden|
|Class Period:||02/06/2015 - 05/02/2017|
|Case Contacts:||Avi Josefson, Scott R. Foglietta, Angus Fei Ni 倪非|
The claims arise from Frontier’s acquisition of millions of customers from Verizon in April 2016, for over $10.5 billion. Prior to the acquisition, Frontier consistently represented that it was ready to complete the acquisition as planned, and repeatedly told investors after the acquisition had closed that integration had been successful. Moreover, Frontier represented that the costs to integrate the newly acquired assets would be approximately $450 million. Contrary to these statements, Frontier knew prior to the acquisition that numerous gaps remained in its integration preparations, and that the cost to properly integrate the newly acquired customers would be far higher.
When defendants ultimately revealed Frontier’s failure to integrate the customers acquired from Verizon – including unpaid bills, lost customers and nearly $1 billion in integration and capital expenditures related to the acquisition – the price of Frontier securities fell precipitously, wiping out over $2 billion in the value of those investments.
Sections 11 and 12 of the Securities Act hold companies, senior executives and directors, and underwriters liable for false statements contained within offering documents issued in connection with public offerings of securities. Frontier garnered approximately $2.75 billion through multiple securities offerings during the Class Period, but misrepresented its readiness for the CTF integration in its offering documents. Likewise, Frontier’s continuing representations concerning the ongoing “success” of its integration progress during the Class Period gives rise to securities fraud claims under Section 10(b) of the Securities Exchange Act.
On October 31, 2017, BLB&G filed a Complaint alleging these claims. Lead Plaintiff motions are currently pending before the Court.
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