SAN DIEGO and IRVINE, Calif., Aug. 27, 2013 /PRNewswire/ -- Shareholder rights attorneys at Robbins Arroyo LLP announce that an investor of BIOLASE, Inc. (NASDAQ: BIOL) ("BIOLASE") has filed a complaint in the U.S. District Court for the Central District of California. The complaint alleges that the company and certain of its officers and directors violated the Securities Exchange Act of 1934 between January 7, 2013 and August 12, 2013 (the "Class Period"). BIOLASE develops, manufactures, and markets lasers in dentistry and medicine.
BIOLASE Accused of Making False and Misleading Statements
According to the complaint, certain BIOLASE officers and directors made false and/or misleading statements and/or failed to disclose information regarding the company's business, operations, and prospects. Specifically, the complaint alleges that, throughout the Class Period, the company and certain of its officers and directors misrepresented and failed to disclose that: (i) contrary to claims by the company that its dental lasers were "becoming the standard of care" in the industry, BIOLASE's lasers were in use in only 5% of dental offices and disfavored by many dentists because of their high cost; (ii) the company's attempt to convert to a direct sales model in the United States was failing because of the high cost of the dental lasers; (iii) BIOLASE was financially impaired by its high debt burden and the terms of its lines of credit with Comerica Bank; and (iv) BIOLASE failed to generate cash from operations and was in default of its lines of credit with Comerica Bank. As a result of these false and misleading statements and omissions, BIOLASE shares traded at artificially inflated prices during the Class Period.
BIOLASE Stock Price Drops on News of Revenue and Earnings Misses
On August 7, 2013, according to the complaint, BIOLASE announced its financial results for its second quarter 2013, reporting revenue of $14.2 million and a $.06 per share loss. Both revenue and earnings numbers were significantly below the $15.69 million revenue and $.04 per share loss BIOLASE had led the market to expect. Then, on August 13, 2013, BIOLASE issued a press release announcing that the company had violated the terms of its covenants with Comerica Bank. On this news, BIOLASE shares fell to $1.81 on August 13, 2013, down nearly 80% from a Class Period high of $6.05 reached on April 29, 2013.
If you invested in BIOLASE and would like to discuss your shareholder rights, please contact attorney Darnell R. Donahue at (800) 350-6003, firstname.lastname@example.org, or via the shareholder information form on the firm's website.
Robbins Arroyo LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested. For more information, please go to http://www.robbinsarroyo.com.
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SOURCE Robbins Arroyo LLP