NEW YORK–(BUSINESS WIRE)–#DXC–Bragar Eagel & Squire, P.C. announces that a class action lawsuit has been filed in the United States District Court for the Northern District of California on behalf of all investors that purchased DXC Technology Company (NYSE: DXC) securities pursuant to and/or traceable to the company’s April 2017 registration statement and prospectus. Investors have until November 15, 2019 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Click here to participate in the action.
In April of 2017 DXC was created when Hewlett Packard Enterprise Company’s Enterprise Services segment was spun off and merged with Computer Sciences Corporation. In conjunction with this transaction, DXC issued a registration and prospectus.
On February 6, 2019, a civil complaint was filed alleging that certain officers of the company were using cost-cutting efforts such as layoffs to inflate short-term financial metrics and that these efforts substantially decreased the company’s ability to deliver contractually obligated services to its clients.
On August 8, 2019, the company lowered its fiscal 2020 revenue guidance by $500 million compared to previously issued guidance.
On this news, the company’s share price fell $15.74, or over 30%, to close at $35.91 per share on August 9, 2019, thereby injuring investors.
The complaint, filed on September 16, 2019, alleges that throughout the Class Period defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and prospects. Specifically, defendants failed to disclose to investors: (1) that the planned “workforce optimization” plan involved implementing arbitrary quotas; (2) that the plan would cut thousands of jobs at the company; (3) that jobs that were particularly at risk of being cut were held by longer-tenured, knowledgeable, and highly compensated senior personnel; (4) that these job terminations were selectively timed to artificially inflate reported earnings and other financial metrics; (5) that, at the time of the merger, defendant Lawrie had forecasted plans for a $2.7 billion workforce reduction in the first year; (6) that, as a result of these workforce terminations, the company was unlikely to deliver on client contracts; (7) that, as a result of the foregoing, the company’s clients would be dissatisfied and the relationships would be impaired; and (8) that, as a result of the foregoing, defendants’ positive statements about the company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.
On the date the complaint was filed, DXC stock traded as low as $32.34 per share, a 45% decline from the $59 per share price at the time of the spin-off and merger.
If you purchased DXC securities during the Class Period, are a long-term stockholder, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Melissa Fortunato by email at [email protected], or telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.
Bragar Eagel & Squire, P.C. is a New York-based law firm concentrating in commercial and securities litigation. For additional information concerning the DXC lawsuit, please go to https://bespc.com/dxc-2. For additional information about Bragar Eagel & Squire, P.C. please go to www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.