Investing is a smart way to manage funds. Often, individuals can see their money increase, by significant amounts in some cases, when they invest wisely. However, it is possible for securities issues like insider trading to put investors at risk because of unfair practices. It is not unusual for class action litigation to result from such situations.
Tennessee readers may be interested in a recent class action lawsuit that was filed in another state. According to reports, allegations have come against Kodak claiming that the company participated in insider trading before making an announcement about an important business move. Kodak had received an offer to move into the pharmaceutical production industry, which sparked interest and investment in the company. However, before making the announcement, the company allegedly granted stock options to company insiders.
An investigation into insider trading started soon after, and the company’s stock took a downturn after investors learned that the business move was being put on hold. The class action lawsuit stems from investors claiming that they took a loss because Kodak’s statements were misleading and because the company did not disclose that company insiders were able to purchase tens of thousands of shares before the announcement. At the time of the report, Kodak had not provided a comment regarding the lawsuit.
Misleading information can cause a great deal of trouble for investors. As this case shows, class action litigation may be needed if losses resulted from misrepresentation of facts, insider trading and other problems relating to securities. If Tennessee residents believe that they have suffered due to such misleading actions, they may want to consider their legal options.