SAN FRANCISCO, July 28, 2016 /PRNewswire/ -- Shareholder and consumer rights law firm Schubert Jonckheer & Kolbe LLP has launched an investigation into whether certain officers and directors of Albany Molecular Research Inc. (NASDAQ: AMRI) breached their fiduciary duties to the company and its shareholders by failing to implement adequate internal controls over the company's management and disclosure procedures.
On July 26, 2016, Judge Frederic Block denied a motion to dismiss a securities fraud class action filed against the company in the United States District Court for the Eastern District of New York. The class action alleges that between August 5, 2014 and November 5, 2014, Albany Molecular concealed from shareholders that a power outage at an acquired laboratory had contaminated the laboratory's inventory. Although the power outage occurred in July 2014, the truth was not revealed to investors until November 5, 2014 when the company announced that, due to the laboratory power failure, AMRI needed to discard moldy inventory and temporarily shut down the facility. On this news, company shares plummeted by $6.08 per share or 35%. On Tuesday, Judge Block denied the Company's motion to dismiss the class action, finding that Chief Executive Officer William Marth and then-acting Chief Financial Officer Michael Nolan must have known about the power outage because of the laboratory's importance to the company's core operations and the magnitude of the alleged false statements.