ATLANTA, GA--(Marketwired - May 8, 2013) - King & Spalding achieved a significant ruling in the Eleventh Circuit Court of Appeals affirming the dismissal of a securities class action against online health product retailer Vitacost.com.
The class action arose after the company experienced manufacturing logistics problems in early 2010 and its stock price dropped. The purported lead plaintiff brought claims under Section 11 of the Securities Act of 1933, a virtually strict-liability statute, for alleged material misstatements and omissions in the company's prospectus filed in connection with its 2009 IPO.
The plaintiffs' complaint spanned 105 pages and contained statements by 11 confidential witnesses, including the company's founder and former chief executive officer.
Despite the lengthy complaint and multiple witness statements, King & Spalding successfully argued that the complaint stated no Section 11 violation. The Eleventh Circuit agreed and affirmed the Southern District of Florida's dismissal with prejudice. The court held that alleged omissions relating to employee terminations were immaterial and the plaintiff failed to plead any omissions relating to a relocation of distribution facilities and Food and Drug Administration compliance. The court issued its ruling on May 6.
A King & Spalding team of business litigation lawyers represented Vitacost.com and individual directors in this matter. Partners Paul R. Bessette and Michael J. Biles led the team, which included associates Royale P. Price, Tyler W. Highful and Daniel S. Epps. All lawyers are located in the firm's Austin, Texas, office except for Epps, who is in the Washington, D.C., office.
About King & Spalding
Celebrating more than 125 years of service, King & Spalding is an international law firm that represents a broad array of clients, including half of the Fortune Global 100, with 800 lawyers in 17 offices in the United States, Europe, the Middle East and Asia. The firm has handled matters in over 160 countries on six continents and is consistently recognized for the results it obtains, uncompromising commitment to quality and dedication to understanding the business and culture of its clients. More information is available at www.kslaw.com.
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