SAN DIEGO, June 27, 2016 /PRNewswire/ -- Johnson & Weaver, LLP announced that a class action has been filed on behalf of purchasers of Inovalon Holdings, Inc. (NASDAQ: INOV) Class A common stock pursuant or traceable to the Registration Statement and Prospectus issued in connection with Inovalon's February 12, 2015 initial public offering ("IPO"). This action was filed in the United States District Court, Southern District of New York.
The complaint charges Inovalon, certain of its officers and directors and the underwriters of its February 2015 IPO with violations of the Securities Act of 1933.
On or about February 12, 2015, Inovalon issued over 25 million shares of common stock at $27 per share, raising more than $684 million in gross proceeds.
The complaint alleges that the Registration Statement issued in connection with the IPO contained untrue statements of material fact and omitted to state material facts both required by governing regulations and necessary to make the statements made not misleading. Specifically, Inovalon failed to disclose that the Company derives substantial revenues from sales in the city and state of New York, both of which were reforming their corporate tax schemes in order to capture more taxes from out-of-state businesses doing substantial business within their borders; these corporate tax rate increases, which would take effect January 1, 2016—more than a month prior to Inovalon's IPO—would significantly increase the Company's effective tax rate and thus lower its 2015 earning potential. This omission rendered false and misleading the Registration Statement's claim that Inovalon's year-over-year "effective income tax rate . . . remained relatively stable at 39%."
As the market learned the truth following the IPO, the price of Inovalon common stock declined significantly.
Plaintiff seeks to recover damages on behalf of all purchasers of Inovalon securities during the Class Period. If you wish to serve as lead plaintiff, you must move the Court no later than August 23, 2016. If you wish to discuss this action, have any questions concerning this notice, or your rights or interests, or if you would like to request a copy of the filed complaint, please contact lead analyst Jim Baker (firstname.lastname@example.org) by email or by phone at 619-814-4471. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
About Johnson & Weaver, LLP:
Johnson & Weaver, LLP is a nationally recognized shareholder rights law firm with offices in California, New York and Georgia. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits. For more information about the firm and its attorneys, please visit http://www.johnsonandweaver.com. Attorney advertising. Past results do not guarantee future outcomes.
Johnson & Weaver, LLP
Jim Baker, 619-814-4471
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SOURCE Johnson & Weaver, LLP