On April 13, 2018, Pomerantz LLP was appointed Lead Counsel in a class action lawsuit against Ballard Power Systems, Inc. (“Ballard” or the “Company”) and certain of its officers. The class action, filed in United States District Court, for the Southern District of New York, and docketed under 18-cv-01137, is on behalf of a class consisting of investors who purchased or otherwise acquired Ballard securities, seeking to recover compensable damages caused by defendants’ violations of the Securities Exchange Act of 1934.
Ballard designs, develops, manufactures, sells and service hydrogen fuel cells for a range of applications. The Company's products and services are used in many industries such as materials handling, residential cogeneration, backup power and transportation. Ballard has represented to investors that the Company has been deploying its technologies in various parts of China, in conjunction with local partners Broad Ocean and Synergy JV.
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 had overstated the operations of its China-based partners Broad Ocean and Synergy JV; (ii) Ballard’s technologies had not been deployed in China to the extent the Company had represented; and (iii) as a result of the foregoing, Ballard shares traded at artificially inflated prices during the Class Period, and class members suffered significant losses and damages.
On January 25, 2018, Spruce Point Capital Management reported that Ballard overstated the operations of its China-based partners Broad Ocean and Synergy JV. In part, the Spruce Point report asserted that “there are no demonstration lines operating in Guangdong and that no bus lines are in service in Sanshui or Yunfu.” The report continued to state that “Ballard and local press releases indicate that [Broad Ocean customer] Foshan has produced 114 FCV buses... [but] a Foshan employee claimed that far fewer buses have been produced to date and only 11 are licensed.”
Following this news, Ballard’s share price fell $0.52, or over 13%, to close at $3.27 on January 25, 2018.