Lawsuits accuse Navistar execs of inflating stock price, violating SEC law
Multiple class action lawsuits brought against International truck manufacturer Navistar International Corp. allege that the company artificially inflated its stock price by withholding information and misleading shareholders. One lawsuit in particular — originally reported on Overdrive sister site Successful Dealer — alleges that former Navistar CEO Dan Ustian and current Chief Financial Officer Andrew Cederoth both took advantage of the artificially high stock price by selling their shares for millions of dollars when the stock was near record high prices.
Successful Dealer‘s report says that Willie Briscoe, one of the attorneys bringing a class action lawsuit, says Navistar violated provisions of the Securities Exchange Act of 1934 and possibly violated state laws between Nov. 3, 2010, and Aug. 1, 2012.
Navistar’s stock reached $70.16 in April 2011 before plummeting nearly 70 percent to $21.44 per share in August 2012 after the company announced it was abandoning its EGR-only approach, discontinuing its MaxxForce 15 engine and partnering with Cummins to equip its 13-liter MaxxForce with Cummins’ SCR aftertreatment system.
That lawsuit is being brought on behalf of a construction worker’s pension fund who bought several thousand shares of Navistar stock and lost about $80,000 in doing so.