Tremor Slapped with Shareholder's Lawsuit
The San Diego-based Shareholders Foundation Inc. said today that a lawsuit has been filed against Tremor Video alleging that Tremor knew at the time of its June initial public stock offering that changes in the online advertising market would harm its competitive position, but didn’t disclose that information adequately in its registration statement and prospectus.
The Shareholders Foundation is a professional portfolio legal monitoring and settlement claim filing service, not a law firm. Tremor had no comment about the suit, though shareholder suits following bumpy IPOs are not at all uncommon, particularly in fast-growing sectors where trends can develop, or evaporate, quickly.
According to portfolio monitoring company the suit alleges that Tremor knew at the time of the IPO that “the online advertising market had materially shifted towards mobile browsing, as opposed to desktop browsing, where Tremor Video Inc. was at a significant disadvantage to its competitors, and that Tremor Video Inc was losing sales to competitors as a result of its inferior mobile browsing capabilities.”
Tremor stock plummeted on Nov. 8, the day after Tremor announced lackluster Q3 earnings and tepid guidance projections. Tremor Video shares lost nearly half of their value following the earnings call, and closed then at $4.72 per share. Since it IPO, Tremor’s per-share price has fallen 45%.