Johnson Fistel, LLP Files Class Action Suit Against Cloudera, Inc.; Class Period Between April 28, 2017 and June 5, 2019
SAN DIEGO- PRNewswire —June 7, 2019
Johnson Fistel, LLP announced that a class action has been commenced on behalf of purchasers of Cloudera, Inc. (“Cloudera” or the “Company”) (NYSE: CLDR) common stock during the period between April 28, 2017 and June 5, 2019 (the “Class Period”).
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Jim Baker at ([email protected]) at 619-814-4471. If emailing, please include a phone number.
The complaint asserts claims against Cloudera, the Company’s Chief Executive Officer, Thomas J. Reilly, Chief Financial Officer Jim Frankola, and founder and former Chairman, Michael A. Olson, (collectively “Defendants”). The claims arise under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
The complaint alleges that during the Class Period, the Defendants failed to disclose adverse facts pertaining to Cloudera’s business, operations, and financial condition, which were known to or recklessly disregarded by Defendants. Specifically, Defendants failed to disclose: (i) Cloudera was finding it increasingly difficult to identify large enterprises interested in adopting the Company’s Hadoop-based platform; (ii) Cloudera needed to expend an increasing amount of capital on sales and marketing activities to generate new revenues; (iii) Cloudera had materially diminished sales opportunities and prospects and could not generate annual positive cash flows for the foreseeable future; (iv) the primary motivation for the Company’s merger with Hortonworks was to generate growth through the acquisition of Hortonworks’ existing customers (as opposed to obtaining them organically); and (v) that the purported synergies and other benefits of the merger with Hortonworks were materially overstated.
The truth began to be revealed to the market on April 3, 2018, when, in connection with its Q4 and FY 2018 financial results, the Company provided a disappointing outlook for fiscal 2019. This news contradicted defendants’ prior positive statements and shocked the market as it had come less than a year after Cloudera went public. In response, the price of Cloudera common stock fell 40% to $13.29 per share. Recently, Cloudera reported on June 5, 2019, that its first quarter revenues were $187.5 million, but that several customers had elected to “postpone renewal and expansion” of their subscription agreements. At this time, the Company also announced that its losses from operations had ballooned to $103.8 million, roughly double the year-over-year period, and that its CEO, Defendant Reilly, would be abruptly retiring from the Company. On this news, the price of Cloudera common stock fell 40% to just $5.21 per share.
As a result of the defendants’ wrongful acts and omissions, and the precipitous decline in the market value of Cloudera’s stock, Plaintiff and other Class members have suffered significant losses and damages.
Plaintiff seeks to recover damages on behalf of all purchasers of Cloudera common stock during the Class Period.
About Johnson Fistel, LLP:
Johnson Fistel, 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 https://www.johnsonfistel.com. Attorney advertising. Past results do not guarantee future outcomes.