HARTFORD, Conn., Dec. 8, 2005 (PRIMEZONE) -- The law firm of Schatz & Nobel, P.C., which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the Middle District of Florida on behalf of all persons who purchased the publicly traded securities of FARO Technologies, Inc. ("FARO" or the "Company") (Nasdaq:FARO) between May 6, 2004, and November 3, 2005 (the "Class Period"). Also included are all those who acquired FARO's shares through its acquisition of !Qvolution.
The Complaint alleges defendants violated federal securities laws by issuing a series of materially false statements. Specifically, FARO repeatedly issued false and misleading quarterly and annualized financial guidance throughout the Class Period knowing of the deficient and defective state of one or more of its controls and systems, with an adverse impact on its inventory accounting, order fulfillment and financial statements. It is further alleged that even though defendants quietly placed a resource management system into operation, defendants continued to conceal their deficient and defective controls and practices, causing the newly implemented system to supply false and erroneous information to the Company's departments and functions, with a continued direct, adverse impact on order fulfillment and corporate earnings.
On November 3, 2005, FARO announced its third quarter of 2005 financial results. The results revealed that FARO had incurred a pre-tax $1.6 million adjustment cost for inventory costing and consumption variances related to the implementation of a new enterprise resource planning ("ERP") system and that FARO had not met growth targets. On this news, the price of FARO stock plummeted $5.88, from its closing price of $22.38 on November 3, 2005, to finally close on November 7, 2005, at $16.50, for a two-day loss of 26.38%.
If you are a member of the class, you may, no later than February 6, 2006, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members, including decisions concerning settlement. The securities laws require the Court to consider the class member(s) with the largest financial interest as presumptively the most adequate lead plaintiff(s).
While Schatz & Nobel has not filed a lawsuit against the defendants, to view a copy of the Complaint initiating the class action or for more information about the case, class action cases in general, and your rights, please contact Schatz & Nobel toll-free at (800) 797-5499, or by e-mail at sn06106@aol.com, or visit our website: www.snlaw.net.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.