Please complete this form relating to your transactions for Leidos Holdings, Inc. (NYSE: LDOS) securities between May 4, 2020 and February 23, 2021, inclusive (the “Class Period”).
You may also contact James Maro, Jr., Esq. or Adrienne Bell, Esq. at 610.667.7706 or toll free at 844.887.9500, or you may submit your information via email at firstname.lastname@example.org, or you may click here to print a PDF of this form.
Notice is hereby given that a class action lawsuit has been filed on behalf of those who purchased or acquired Leidos Holdings, Inc. (“Leidos”) (NYSE: LDOS) securities between May 4, 2020 and February 23, 2021, inclusive (the “Class Period”).
Leidos is a science, engineering, and information technology company that provides services and solutions in the defense, intelligence, homeland security, civil and health markets, both domestically and internationally.
The Class Period commences on May 4, 2020, when Leidos announced that it had completed the acquisition of L3Harris Technologies’ Security Detection and Automation businesses (“SD&A Businesses”).
According to the complaint, on February 16, 2021, Spruce Point Capital Management LLC (“Spruce Point”) published a research report, alleging, among other things that “Leidos is potentially covering up at least $100m of fictitious sales, mischaracterizing $355 - $367m of international revenue.” The report also alleged that Leidos was “concealing numerous product defects from investors, notably faulty explosive detection systems at airports and borders.” Following this news, Leidos’s share price fell $2.58, or 2.4%, to close at $105.22 per share on February 16, 2021.
Then, on February 23, 2021, Leidos announced its fourth quarter and full year 2020 financial results in a press release. Therein, Leidos reported $89 million in revenue related to the SD&A Businesses for the fourth quarter, meaning that after two full quarters, the acquisition generated only $163 million in sales (or $326 million annualized), falling well short of projected $500 million sales. Leidos expected cash flow of $850 million, well below analyst estimates of $1.083 billion. Following this news, Leidos’s stock price fell $10.29, or 9.91%, to close at $93.51 per share on February 23, 2021.
Finally, on February 24, 2021, Spruce Point highlighted that Leidos had “materially expanded” the risk disclosures in its annual report for the year ended December 31, 2020, which had been filed after the market closed on February 23, 2021. Spruce Point tweeted: “We believe it is validating all the major points of our report.” Spruce Point noted that Leidos expanded its risk disclosures regarding insurance coverage, as “Liedos is shipping defective products back from various countries [that] may not have the same protections as in the U.S.” Following this news, Leidos’s stock price fell $3.13, or 3.3%, to close at $90.38 per share on February 24, 2021.
The complaint alleges that, throughout the Class Period, the defendants failed to disclose to investors that: (1) the purported benefits of Leidos’s acquisition of L3Harris Technologies’ SD&A Businesses were significantly overstated; (2) Leidos’s products suffered from numerous product defects, including faulty explosive detection systems at airports, ports, and borders; (3) as a result of the foregoing, Leidos’s financial results were significantly overstated; and (4) as a result of the foregoing, the defendants’ positive statements about Leidos’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.