Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against Avaya Holdings Corp. (AVYA)
NEW YORK, Jan. 06, 2023 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the United States District Court for the Middle District of North Carolina on behalf of all persons or entities who purchased the securities of Avaya Holdings Corp. (“Avaya” or the “Company”) (NYSE: AVYA) between November 22, 2021 and November 29, 2022, both dates inclusive (the “Class Period”).
The Complaint alleges that Defendants failed to disclose that: (1) the Company’s internal control over financial reporting (“ICFR”) was deficient in several areas; (2) as a result of these deficiencies, the Company had failed to design and maintain effective controls over its whistleblower policies and its ethics and compliance program; and (3) the Company’s deteriorating financial condition was likely to raise substantial doubt as to its ability to continue as a going concern.
On July 28, 2022, the Company announced the termination of its CEO, James M. Chirico, Jr. The Company also announced preliminary third quarter of 2022 financial results that included expected revenues and adjusted earnings before interest, taxes, depreciation, and amortization well below previously given guidance and an unquantified but “significant” impairment charge. Avaya also withdrew its 2022 guidance. On this news, Avaya’s stock price declined more than 56%.
On August 9, 2022, the Company announced that: (1) Avaya determined there was substantial doubt about its ability to continue as a going concern; (2) Avaya would not timely file its financial statements for the quarter ended June 30, 2022; (3) Avaya’s Audit Committee commenced internal investigations into circumstances surrounding Avaya’s financial results for the quarter; and (4) the Audit Committee also commenced an investigation into matters raised by a whistleblower. On this news, Avaya’s stock price declined more than 45%.
On November 30, 2022, the Company disclosed that “control deficiencies that management had been reviewing represent material weaknesses in [Avaya’s] [ICFR]” and that “management’s assessment of ICFR included in Item 9A of [Avaya’s] Annual Report on Form 10-K for its fiscal year 2021 ended September 30, 2021, filed with the [U.S.] Securities and Exchange Commission (the ‘SEC’) on November 22, 2021 . . should no longer be relied upon.” Specifically, Avaya revealed that it “did not design and maintain effective controls related to the information and communication component of the COSO (Committee of Sponsoring Organizations of the Treadway Commission) framework,” “did not design and maintain effective controls to ensure appropriate communication between certain functions within [Avaya],” and “did not design and maintain effective controls over the ethics and compliance program.” On this news, the Company’s stock price declined more than 14%, further damaging investors.
Investors who purchased or otherwise acquired shares of Avaya should contact the Firm prior to the March 6, 2023 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at email@example.com or firstname.lastname@example.org.
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