CONSHOHOCKEN, Pa.- January 18, 2006- LAWFUEL – The Law News Network -Goldman Scarlato & Karon, P.C., a law firm with offices in Conshohocken, PA and Cleveland, OH announces that a lawsuit has been filed in the United States District Court for the Middle District of Florida, on behalf of persons who purchased or otherwise acquired publicly traded securities of FARO Technologies Inc. (“FARO” or the “Company”) (NASDAQ:FARO – News) between May 6, 2004 and November 3, 2005, inclusive, (the “Class Period”). The lawsuit was filed against FARO and certain officers and directors (“Defendants”).
If you are a member of this class and wish to view a copy of a complaint and join this class action, please e-mail us [email protected] and request a copy of the complaint and a plaintiff certification. If you are a member of the Class, you may move the Court no later than February 6, 2006 to serve as a lead plaintiff for the Class. Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. However, if you choose to remain an absent class member, unless and until a class is certified, you are not represented by counsel.
The complaint alleges that Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Specifically, the complaint alleges that FARO repeatedly issued false and misleading quarterly and annualized financial guidance during the Class Period in reckless disregard of the Company’s deficient internal control systems. The complaint alleges that FARO represented itself as having implemented lean manufacturing principles that had brought about numerous operating and efficiency improvements in its production capacity. However, theses statements were materially false and misleading because the Company’s internal inventory and accounting controls were defective during the class period.
On November 3, 2005, investors learned the truth regarding the adverse impact of the Company’s deficient control systems and poor financial performance. After the market closed, the Company disclosed that it had incurred $1.6 million in inventory costing and consumption variances due to processing problems related to the implementation of a new ERP system. As a result of this disclosure, FARO stock fell $5.88 per share to close at $16.50 per share on November 7, 2005.
If you bought FARO securities between May 6, 2004 and November 3, 2005, inclusive, and would like to obtain information about the lawsuit, then you are invited to call (888) 753-2796 to speak with an advisor.