Robbins Geller Rudman & Dowd LLP Announces Upcoming Lead Plaintiff Deadline in the Danimer Scientific, Inc. Class Action Lawsuit
SAN DIEGO–(BUSINESS WIRE) – Robbins Geller Rudman & Dowd LLP announces that buyers of Danimer Scientific, Inc. (NYSE: DNMR) securities will be available between October 5, 2020 and May 4, 2021 (the “Class Period”) through July 13th Have time in 2021 to apply for appointment as the lead plaintiff in the Danimer Scientific class action lawsuit. The first case filed is Rosencrants v Danimer Scientific, Inc., No. 21-cv-02708, and it is assigned to Judge Margo K. Brodie of the Eastern District of New York.
The Private Securities Litigation Reform Act of 1995 allows any investor who has purchased Danimer Scientific securities during the class action period to seek appointment as the lead plaintiff in Danimer Scientific’s class action. A lead plaintiff is usually the applicant with the greatest financial interest in the legal protection sought by the alleged class, which is also typical and appropriate for the alleged class. One lead plaintiff is acting on behalf of all of the other class plaintiffs in directing the Danimer Scientific class action. The lead plaintiff can choose a law firm of their choice to bring Danimer Scientific’s class action lawsuit. An investor’s ability to participate in a possible future collection of Danimer Scientific’s class action lawsuit does not depend on whether or not they are the lead plaintiff. If you would like to stand as the lead plaintiff in the Danimer Scientific class action or if you have any questions about your rights in relation to the Danimer Scientific class action, please include your information here or contact attorney JC Sanchez of Robbins Geller at 800 / 449- 4900 or 619 / 231-1058 or by email to [email protected] Lead plaintiffs’ motions for the Danimer Scientific class action must be filed with the court by July 13, 2021 at the latest.
In December 2020, Live Oak Acquisition Corp., a publicly traded company for purpose acquisition (“SPAC”), merged with Meredian Holdings Group, Inc., a performance polymer company specializing in bioplastic substitutes for traditional petrochemical plastics. After the business combination, Live Oak changed its name to “Danimer Scientific, Inc.”, changed its business to the old Danimer Scientific business, and replaced the management with the old management of Danimer Scientific. Since 2020 Danimer Scientific has been commercially selling polyhydroxyalkanoates (“PHAs”) under its proprietary brand name “Nodax” for use in a variety of plastic applications, including but not limited to water bottles, straws and food containers. Danimer Scientific has touted Nodax as a 100% biodegradable, renewable and sustainable plastic that is said to be superior to traditional plastics due to its advanced biodegradability. Danimer Scientific attributes the advanced biodegradability of Nodax to the microorganisms in nature that eat the bioplastic.
Danimer Scientific’s class action alleges that during the collection period, defendants made false and misleading statements and failed to disclose that: (i) Danimer Scientific had poor internal controls; (ii) as a result, Danimer Scientific had misrepresented, among other things, the size of its business and regulatory compliance; (iii) Defendants had overestimated the biodegradability of Nodax, particularly in oceans and landfills; and (iv) as a result, Danimer Scientific’s public statements at all relevant times have been materially false and misleading.
On March 20, 2021, the Wall Street Journal (“WSJ”) published an article entitled “Plastic Straws That Quickly Biodegrade in the Ocean, Not Quite, Scientists Say,” which addresses, among other things, Danimer Scientific’s claims that Nodax breaks down far more quickly than fossil plastics. The WSJ article claimed that, according to several biodegradable plastics experts, “many claims about Nodax are exaggerated and misleading”. While Danimer Scientific allegedly claims its claims are factual, the article quotes at least one expert who states that broad claims about the biodegradability of Nodax are “incorrect” and “greenwashing”. As a result of this news, Danimer Scientific’s share price fell nearly 13%, which hurt investors.
Then, on April 22, 2021, analyst Spruce Point Capital Management released a report on the letter from Danimer Scientific that Danimer Scientific is “another attempt at plastic alternatives with multiple corporate governance red flags: 65% -100% downside risk”. In that report, Spruce Point claims that “Danimer’s growth expansion story is likely to fail, as have others who have tried before. The most surprising aspect of Danimer’s business isn’t its lackluster technology, as highlighted in the Wall Street Journal’s March 2021 article, but rather the multiple red flags on corporate governance we’ve seen from past and current CEOs, the CTO, and current executives and directors of Danimer found. “Spruce Point continued,” We question the independence of Danimer’s scientific research as Danimer was a funder of the University of Georgia Lab and several professors who authored the supporting research. . . . We also believe that by making numerous website changes and omitting previous press releases, Danimer has masked a pattern of contradicting and inconsistent statements about capacity, facility size and capital costs. . . . “On the basis of this news, Danimer Scientific’s share price fell another 8%.
Finally, on May 4, 2021, Spruce Point published a follow-up report that said, “Danimer FOIA Findings Show Smoking Gun Evidence of Price Inflation and Slackness in Capacity”. Spruce Point went on to say that “with the benefit of a recently published” [FOIA] At the request of the Kentucky Department of Environmental Protection, we have evidence to suggest that Danimer’s production numbers, prices and rosy financial projections are grossly overrated. Kentucky PHA’s monthly production numbers have been adjusted by up to 100% after it was released. Danimer’s average PHA sale price appears to be 30% – 42% below management’s claims. In addition, Danimer’s recent production numbers are so far below actual capacity that it questions why Danimer is telling investors that it will take hundreds of millions of dollars to expand capacity? ”On that news, Danimer Scientific’s shares fell further 6%, which harmed investors.
With 200 attorneys in 9 offices across the country, Robbins Geller Rudman & Dowd LLP is the largest US law firm serving investors in securities class actions. Robbins Geller’s attorneys have secured many of the largest shareholder reclaims in history, including the largest securities class action of all time – $ 7.2 billion – in In re Enron Corp. Sec. Lit. The 2020 ISS Securities Class Action Services Top 50 Report ranked Robbins Geller first for getting $ 1.6 billion back for investors last year, more than double the amount paid by all other securities plaintiffs was reclaimed. More information is available at http://www.rgrdlaw.com.
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