Press release from PR Newswire
Tellabs, Inc. Is Being Investigated on Behalf of Shareholders
Monday, April 08, 2013
Tellabs, Inc. Is Being Investigated on Behalf of Shareholders14:17 EDT Monday, April 08, 2013
SAN DIEGO and NAPERVILLE, Ill., April 8, 2013 /PRNewswire/ -- Shareholder rights law firm Robbins Arroyo LLP is investigating whether officers and directors of Tellabs, Inc. (NASDAQ: TLAB) breached their fiduciary duties to shareholders. Tellabs designs, develops, and supports telecommunication networking products in the United States and internationally.
Robbins Arroyo LLP Investigates Potential Misstated Financial Results in Tellabs' Previously Filed Financial Statements for 2010 and 2011
Robbins Arroyo LLP is investigating whether Tellabs improperly recognized revenue and artificially inflated its stock price by filing potentially false and misleading financial reports for fiscal years 2010 and 2011. On January 25, 2011, the company issued a press release announcing fourth quarter 2010 revenue of $410.5 million, consistent with previous expectations. However, in a conference call later that day, Tellabs disclosed that due to the adoption of new accounting standards, the company recognized revenue in fourth quarter 2010 that would have previously been recognized in the first quarter of 2011. After factoring in this change, Tellabs' fourth quarter 2010 revenue declined $20.8 million from the $410.5 million as previously reported, to only $389.7 million. On this news, Tellabs shares declined $1.35 per share or 20% to close on January 25, 2011 at $5.69 per share.
In addition, Robbins Arroyo LLP is reviewing whether certain of Tellabs' officers and directors failed to implement adequate internal controls in order to avoid further misrepresentations of revenue. On November 29, 2011, Tellabs announced that it would be forced to restate its second and third quarter financial results because it had improperly accounted for $17.5 million of revenue in the second quarter 2011 from a product that had not been delivered to its client until the third quarter 2011. Further demonstrating Tellabs' lack of internal controls, the company was forced to again restate its second and third quarter 2011 financial results on July 27, 2012, due to a clerical error when filing the first restatement.
Moreover, company insiders may have been personally motivated to cause Tellabs to issue false and misleading statements in order to benefit from the sale of Tellabs securities from their personal portfolio. Indeed, during the time in question, company insiders sold 405,228 shares of Tellabs stock for $2,555,200.
Robbins Arroyo LLP highlights that Tellabs shareholders have the option to pursue a shareholder derivative action through which shareholders aim to hold insider wrongdoers accountable for their actions, prevent future misconduct, and bring long-term value back to the company. Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, DDonahue@robbinsarroyo.com, or via the shareholder information form on the firm's website.
Robbins Arroyo LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested. For more information, please go to http://www.robbinsarroyo.com.
Press release link: http://www.robbinsarroyo.com/shareholders-rights-blog/tellabs/
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Contact:Darnell R. DonahueRobbins Arroyo LLPDDonahue@robbinsarroyo.com (619) 525-3990 or Toll Free (800) 350-6003www.robbinsarroyo.com
SOURCE Robbins Arroyo LLP