NEW YORK, Jan. 24, 2014 /PRNewswire/ -- Pomerantz LLP has filed a class action lawsuit against OSI Systems, Inc. ("OSI Systems" or the "Company") (NASDAQ: OSIS) and certain of its officers. The class action, filed in United States District Court, Central District of California, and docketed under 13-cv-9171-MWF, is on behalf of a class consisting of all persons or entities who purchased or otherwise acquired securities of OSI Systems between January 24, 2012 and December 6, 2013 both dates inclusive (the "Class Period"). This class action seeks to recover damages against the Company and certain of its officers and directors as a result of alleged violations of the federal securities laws pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.
If you are a shareholder who purchased OSI Systems securities during the Class Period, you have until February 10, 2014 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at email@example.com or 888.476.6529 (or 888.4-POMLAW), toll free, x237. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.
OSI Systems produces medical monitoring and anesthesia systems; security and inspection systems; and lasers, optics, and optoelectronic components.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) the Company manipulated operational test of its Advanced Imaging Technology by selectively picking the best sensors, causing the test not to be representative of the scanners already deployed at airports; (ii) the Company's products raised strong privacy concerns and were subject to disqualification for use in airport security checkpoints; (iii) the Company manufactured its products with parts that directly violated contracts with the TSA, thereby risking cancellation of the contracts; and, (iv) as a result of the above, the Company's financial statements were materially false and misleading at all relevant times.
On November 14, 2012, after the market closed, various news sources, including Bloomberg News reported that a key congressman disclosed the Company may have committed fraud by "knowingly manipulating" the results of an operational test in connection with the Company's Advanced Imaging Technology ("AIT"), otherwise commonly known as body scanners. Moreover, Bloomberg News cited to an executive vice president of the Company who revealed that its Rapiscan unit had received a so-called "show cause" letter from the Transportation Security Administration ("TSA") on November 9, 2012, seeking detailed information about the testing of technology used in its body scanners. On this news, OSI Systems shares declined $21.40 per share or 28%, to close at $54.89 per share on November 15, 2012.
On January 22, 2013, the TSA reported that it had ended its contract with the Company, and that OSI Systems would have to bear the costs of removing all Rapiscan full body scanners from airports, because TSA administrators concluded the company could not meet a congressional deadline to produce generic passenger images. On this news, the Company's shares fell $14.03 per share to $57.33, a one day decline of over 19%.
Thereafter, on December 6, 2013, the United States Transportation Security Administration canceled a $60 million contract for the company's carry-on baggage screening equipment, with the possibility of a future ban on contracting with the Department of Homeland Security. The reason for the canceled contract and future ban is that a part in the company's baggage scanning machine was manufactured in China, violating TSA security policies. On this news, the Company's shares fell $21.69 per share to $43.63, a decline of over 33% on December 6, 2013.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and San Diego, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.
Robert S. Willoughby
SOURCE Pomerantz LLP