NEW YORK, Feb. 28, 2020 /PRNewswire/ -- Today, prominent investor rights law firm Bernstein Litowitz Berger & Grossmann LLP ("BLB&G") filed a class action lawsuit for violations of the federal securities laws in the U.S. District Court for the Northern District of Texas against Fluor Corporation ("Fluor") and certain of Fluor's current and former senior executives (collectively, "Defendants") on behalf of investors in Fluor common stock between November 2, 2017 and February 14, 2020, inclusive (the "Class Period").
BLB&G filed this action on behalf of its client, Union Asset Management Holding AG, and the case is captioned Union Asset Management Holding AG v. Fluor Corporation, No. 3:20-cv-00518 (N.D. Tex.). The complaint is based on an extensive proprietary investigation and a careful evaluation of the merits of this case. A copy of the complaint is available on BLB&G's website by clicking here.
Fluor's Alleged Fraud
Based in Irving, Texas, Fluor operates, through its subsidiaries, as a global engineering, procurement, construction, and maintenance company that designs, builds and maintains energy and gas facilities for both public and private clients. The claims alleged in this case arise from Defendants' misrepresentations and omissions regarding Fluor's revenue recognition practices.
The complaint alleges that, throughout the Class Period, Defendants inflated Fluor's revenue and earnings by improperly recognizing revenue on 16 separate projects ("2Q 2019 Projects"). Once awarded a contract to perform work on a construction project, the Company would routinely submit "change orders" to its clients to request additional funds, which the client was not contractually obligated to pay, to cover "unforeseen circumstances." Defendants repeatedly made false and misleading statements to investors regarding Fluor's revenue recognition practices with respect to its submission of these change orders. As a result of Defendants' misrepresentations, shares of Fluor's common stock traded at artificially inflated prices during the Class Period.
The truth emerged through a series of disclosures beginning on May 2, 2019, when Fluor announced the immediate departure of its CEO, David T. Seaton, significantly reduced its earnings guidance, and disclosed that Fluor was taking charges of over $100 million on various projects due, in part, to Fluor's "revenue recognition" practices.
Then, on August 1, 2019, Defendants revealed that Fluor would be taking a $714 million charge on the 2Q 2019 Projects, including incurring a $233 million charge on Fluor's project at the Radford Army Ammunition Plant (the "Radford Project").
Finally, on February 18, 2020, Defendants revealed that the U.S. Securities and Exchange Commission was investigating Fluor's revenue recognition practices related to the 2Q 2019 Projects and had requested information related to those projects. In addition, Defendants announced that Fluor had also commenced an internal investigation into the 2Q 2019 Projects, "focusing initially on the Radford [Project]." As a result of these disclosures, the price of Fluor common stock declined precipitously.
If you wish to serve as Lead Plaintiff for the Class, you must file a motion with the Court no later than April 28, 2020, which is the first business day on which the U.S. District Court for the Northern District of Texas is open that is 60 days after the publication date of February 28, 2020. Any member of the proposed Class may seek to serve as Lead Plaintiff through counsel of their choice, or may choose to do nothing and remain a member of the proposed Class.
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 e-mail at firstname.lastname@example.org.
BLB&G is widely recognized worldwide as a leading law firm advising institutional investors on issues related to corporate governance, shareholder rights, and securities litigation. Since its founding in 1983, BLB&G has built an international reputation for excellence and integrity and pioneered the use of the litigation process to achieve precedent-setting governance reforms. Unique among its peers, BLB&G has obtained several of the largest and most significant securities recoveries in history, recovering over $33 billion on behalf of defrauded investors. More information about the firm can be found online at www.blbglaw.com.
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SOURCE Bernstein Litowitz Berger & Grossmann LLP