AMSC settles lawsuit for $10M
AMSC has agreed to set aside $10 million to settle claims that it artificially inflated its financial results between July 2010 and July 2011, according to court filings.
A class action lawsuit filed in August 2011 alleged that the premature recognition of revenue on shipments to China-based wind turbine manufacturer Sinovel and other customers artificially raised the Devens-based wind and power grid company’s stock price prior to a secondary stock offering.
AMSC – formerly American Superconductor -- has agreed to pay $8.2 million in cash as well as $1.8 million in stock settlement to shareholders during the period of alleged wrongdoing. AMSC spokeswoman Kerry Farrell said the $8.2 million will be funded through the company's insurance plan.
Stockholders will receive some 12 cents per share of AMSC stock if all eligible stockholders submit claims.
AMSC continues to deny it did anything wrong, according to settlement papers.
“The settlement allows both sides to avoid the risks and cost of lengthy and uncertain litigation and the uncertainty of a trial and appeals, and permits (shareholders) to be compensated without further delay,” according to a December settlement notice.
Stockholders are required to submit a proof of claim by March 26 to share in the distribution of the settlement fund.
Updated at 2:10 p.m. with comments from an AMSC spokeswoman.
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