Lawsuit brought by Kodak shareholders fails
A shareholder class action lawsuit brought by investors who purchased stock in Eastman Kodak during 2011 was dismissed by U.S. District Judge Harold Baer yesterday.
The case had been mounted by a group of shareholders who claimed that the Kodak's share price had been artificially inflated following statements by the company's CEO, CFO and COO, and that this was in violation of the 1934 Securities Exchange Act.
Kodak filed for bankruptcy on January 19th, 2012 and the case was brought against the current Kodak CEO Antonio Perez and three former executives because of the company's Chapter 11 status. The suit says in part:
During the Class Period, Perez was responsible for the issuance of false and misleading statements about Kodak and failed to disclose the true and material facts about the Company’s digital transformation, liquidity, financial condition and prospects and bankruptcy considerations.
Reuters reports that Judge Baer ruled that there was no evidence that the executives deliberately misled investors about the company's plans for transformation or its financial situation.
Kodak's share prices during the period covered by the lawsuit fell from approximately $4 to 30 cents.