|Company Name||Nutanix, Inc.|
|Class Period||September 21, 2021 to March 06, 2023|
|Lead Plaintiff Motion Deadline||June 13, 2023|
On March 6, 2023, after the market closed, Nutanix disclosed that it would be unable to file its Quarterly Report on Form 10-Q for the quarter ended January 31, 2023 on time because the Company’s Audit Committee was conducting an investigation with the assistance of outside counsel. The investigation relates to “certain evaluation software from one of the Company’s third-party providers [that] was instead used for interoperability testing, validation and customer proofs of concept over a multi-year period.” The Company further disclosed that the issue is likely to result in “additional costs . . . incurred to address the additional use of the software.”
On this news, Nutanix’s stock price fell $2.27, or 7.8%, to close at $26.50 per share on March 7, 2023, thereby injuring investors.
Then, on March 16, 2023, Nutanix announced that it had received a letter from Nasdaq stating that, “because the Company has not yet filed its Quarterly Report . . . for the quarter ended January 31, 2023, the Company is not in compliance with Nasdaq Listing Rule 5250(c)(1), which required timely filing of all required periodic financial reports with the [SEC].”
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) the Company maintained deficient internal controls relating to its use of licensed software and expense management; (2) as a result of these deficiencies, the Company improperly used third-party evaluation software for business purposes over a multi-year period; (3) investigation and remediation of the foregoing— i.e., by paying vendors the full cost to use their software for business purposes—would cause the Company to incur significant expenses; and (4) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
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