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HEXO Corp. (NYSE: HEXO) Investor Securities Class Action Lawsuit 11/26/2019

  • If you purchased shares of HEXO Corp. (NYSE: HEXO), you may have certain options. Please contact the Shareholders Foundation, Inc.

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Lawsuit Overview

Case Dismissed
Company
HEXO Corp.
Security
NYSE: HEXO

Case Name
HEXO Shareholder Class Action Lawsuit 11/26/2019
Type of Lawsuit
Shareholder Class Action
Court of Filing
U.S. District Court for the Southern District of New York

Class Period Begin
Class Period End
Deadline To File for Lead
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Summary

March 8, 2021 - The case was dismissed.

July 30, 2020 - A motion to dismiss the corrected amended complaint was filed.

June 15, 2020 - A corrected amended complaint was filed.

June 12, 2020 - An amended complaint was filed.

November 26, 2019 - An investor in shares of HEXO Corp. (NYSE: HEXO) filed a lawsuit in the U.S. District Court for the Southern District of New York over alleged violations of Federal Securities Laws by HEXO Corp. in connection with certain allegedly false and misleading statements made between January 25, 2019 and November 15, 2019.

Canada based HEXO Corp., through its subsidiary, HEXO Operations Inc., produces, markets, and sells cannabis in Canada. HEXO Corp. reported that its Total Revenue rose from over $4.09 billion for the 12 months period that ended on July 31, 2017 to over $4.493 billion for the 12 months period that ended on July 31, 2018 and that its Net Loss over those respective time periods increased from over $12.41 billion to over $23.34 billion.

On October 4, 2019, HEXO Corp. announced the immediate resignation of its Chief Financial Officer (“CFO”) Michael Monahan, after only four months as the Company’s CFO. Shares of HEXO Corp. (NYSE: HEXO) declined to as low as $1.56 per share on November 19, 2019.

According to the complaint the plaintiff alleges on behalf of purchasers of HEXO Corp. (NYSE: HEXO) common shares between January 25, 2019 and November 15, 2019, that the defendants violated Federal Securities Laws.

More specifically, the plaintiff claims that between January 25, 2019 and November 15, 2019, the Defendants failed to disclose to investors that HEXO’s reported inventory was misstated as the Company was failing to write down or write off obsolete product that no longer had value, that HEXO was engaging in channel-stuffing in order to inflate its revenue figures and meet or exceed revenue guidance provided to investors, that HEXO was cultivating cannabis at its facility in Niagara, Ontario that was not appropriately licensed by Health Canada, and that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.