World News: 01:00 GMT Tuesday 14th January 2020. [Hagens Berman Sobol Shapiro LLP via Globe Newswire via SPi World News]
SAN FRANCISCO, Jan. 13, 2020 (GLOBE NEWSWIRE) -- Hagens Berman urges investors in HEXO Corp. who have suffered losses in excess of $500,000 to to learn if they qualify to recover their investment losses. Hagens Berman has filed a against HEXO and its senior executives and the application deadline for investors is fast approaching.
According to the detailed Complaint filed by Hagens Berman, Defendants misled investors throughout the Class Period by making materially false and/or misleading statements, as well as failing to disclose material adverse facts about the Company’s business, operations, and prospects.
Specifically, the Complaint alleges Defendants failed to disclose to investors that: (1) HEXO’s reported inventory was misstated as the Company was failing to write down or write off obsolete product that no longer had value; (2) HEXO was engaging in channel-stuffing in order to inflate its revenue figures and meet or exceed revenue guidance provided to investors; (3) HEXO was cultivating cannabis at its facility in Niagara, Ontario that was not appropriately licensed by Health Canada; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
The truth emerged through a series of disclosures occurring between Oct. 4, 2019 and Nov. 15, 2019, when the Company announced it was producing cannabis in a section of its Niagara facility that was not properly licensed with Health Canada.
As a result of these disclosures, the value of HEXO stock has consistently decreased, damaging investors.
Most recently, on Jan. 2, 2020, the Company filed its restated annual financial statements for the fiscal year ended July 31, 2019 and its restated interim financial statements for the three months ended Oct. 31, 2019. Among other things, the Company increased its impairment loss on inventory by about 14% for the fiscal year and announced material weaknesses in internal controls over financial reporting.
“We’re focused on investors’ losses and proving Defendants knowingly provided false financial information to the market,” said Reed Kathrein, the Hagens Berman partner leading the investigation.
If you purchased HEXO common stock during the Class Period and suffered significant losses, .
Globe Newswire: 01:00 GMT Tuesday 14th January 2020
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