On September 25, 2015, Pomerantz LLP was appointed Co-Lead Counsel in a class action lawsuit against TrueCar, Inc. ("TrueCar" or the "Company") and certain of its officers. The class action, filed in United States District Court, Central District of California, and docketed under 15-cv-03979, is on behalf of a class consisting of all persons or entities who purchased TrueCar securities between May 16, 2014 and May 20, 2015 inclusive (the "Class Period"). This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1934 (the "Exchange Act").
TrueCar operates as an Internet-based information, technology, and communication services company. The company operates its platform on the TrueCar Website and TrueCar mobile applications. It also customizes and operates its platform for its affinity group marketing partners, including financial institutions, membership-based organizations, and employee buying programs for large enterprises.
The Complaint alleges that throughout the Class Period, defendants made false and/or misleading statements, and failed to disclose material adverse facts about the Company's business, operations, prospects and performance. Specifically, during the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (i) TrueCar's business practices violated unfair competition and deceptive trade practice laws; (ii) TrueCar acts as a dealer and broker in car sales transactions without proper licensing, in violation of various States' laws that govern car sales; and (iii) as a result of the above, the Company's financial statements were materially false and misleading at all relevant times.
On March 9, 2015, a complaint was filed in Federal Court against TrueCar claiming that car dealers have been injured by the Company's business practices which violated unfair competition and deceptive trade practice laws. On this news, shares of TrueCar fell $0.47, or over 2.7%, to close at $16.50 on May 10, 2015.
On May 20, 2015, a lawsuit was filed against TrueCar in Los Angeles County Superior Court, claiming that TrueCar violates various laws that govern car sales in the state including allegations that TrueCar acts as a dealer and broker in car sales transactions without proper licensing. On the news, shares of TrueCar fell $1.04, or over 6.9%, to close at $13.99 on May 20, 2015.