This post relates to a company listed on the US stock-exchange.
As of today, the company is being sued by former employees in
Europe.
This fact has never been mentionned in any of the last SEC fillings,
despite the fact that the company is at risk on the court case.
According to local regulations, the company might have to pay up to
one
year of salary to each former employee, representing up to 1/50 of
the
overwall annual revenues of the company.
All of these former employees, stock owners, are also considering
suing
the company for misinformation regarding these risks.
I would be very pleased to get further information about the US law
regarding such questions.
I assume the company is publicly traded, because you said there were
SEC filings. If you mean a 10K filing, it is required to contain all
information that a reasonable investor would think to be material in
reaching an investment decision. That doesn't mean every lawsuit must
be mentioned. If the company determined that the lawsuit is not a
material contingent liability, they wouldn't disclose it. A risk
amounting to 2% of revenue might be non-material. If that decision is
wrong, nothing will be done about it unless the SEC decides to do
something. An investor could use that omission as the basis of a
lawsuit, if the omission is material. Also, disclosures in the 10K
report can be incorporated by reference to attached documents. So
maybe the lawsuit was disclosed in such an attachment. Also, the
various stock exchanges have rules of disclosure, which may have been
violated.
McGyver
