Cases

West Palm Beach Firefighters’ Pension Fund v. Spectrum Brands Holdings, Inc., et al.

Court: United States District Court of the Western District of Wisconsin
Case Number: 3:19-CV-00347
Class Period: 06/14/2016 - 11/16/2018
Case Contacts: Avi Josefson, Edward G. Timlin

This is a securities class action lawsuit filed on behalf of all persons who purchased Spectrum Brands Holdings, Inc.'s (“Spectrum” or the “Company”) publicly traded securities from June 14, 2016 to November 16, 2018, inclusive (the “Class Period”).   The action is brought against Spectrum and certain of the Company’s current and former senior executives (collectively, “Defendants”), and asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. §§ 78j(b) and 78t(a), and SEC Rule 10b-5 promulgated thereunder, 17 C.F.R. § 240.10b-5.  A copy of the Complaint is available here.

The Complaint expands the class period that was asserted in a related action against Spectrum – Wagner v. Spectrum Brands Legacy, Inc., et al., No. 19-CV-178 (W.D. Wis.) (“Wagner”) – the first-filed securities class action in this matter, which is presently pending before the Honorable James D. Peterson.  Per the notice published on March 7, 2019 in connection with the filing of the Wagner action pursuant to the Private Securities Litigation Reform Act of 1995, investors wishing to serve as Lead Plaintiff are required to file a motion for appointment as Lead Plaintiff by no later than May 6, 2019.  BLB&G’s filing of the West Palm Beach Firefighters’ Pension Fund complaint (the “Complaint”) does not alter that deadline.

The Complaint alleges that during the Class Period, Defendants falsely stated that Spectrum was successfully executing on two major capital projects consolidating the operations of its critical Global Auto Care (“GAC”) and Home & Hardware Improvement (“HHI”) divisions.  The Complaint alleges that Defendants repeatedly told the market that the GAC and HHI consolidations were progressing effectively and on schedule, and any issues were merely temporary, transitory, and being quickly corrected.  In truth, Defendants knew that the GAC and HHI consolidations were suffering from fundamental execution problems that were far more serious than disclosed to investors.

On April 26, 2018, Spectrum disclosed disappointing financial results for the second quarter of 2018 based on the poorly executed consolidation projects.  Former CEO Andreas Rouvé resigned.  Spectrum’s stock price declined about 22.1%, from $93.14 to $72.56 per share.  Defendants immediately represented that the problems at the GAC and HHI facilities were being swiftly corrected. 

Then, on November 16, 2018, the Company disclosed another disastrous quarter driven by a $92.5 million goodwill write down for GAC, again because of the poorly executed consolidations.  Spectrum’s stock price declined another 19%, from $59.35 to $48.05 per share. 

If you wish to discuss this Action or have any questions concerning this notice or your rights or interests, please contact Avi Josefson of BLB&G at 212-554-1493, or via email at avi@blbglaw.com.

Other Cases of Interest