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Rackable Systems Inc (NASDAQ: RACK) Investors Securities Class Action Lawsuit 01/16/2009

  • If you purchased shares of Rackable Systems Inc (NASDAQ: RACK), you might have certain options and should contact the Shareholders Foundation, Inc.

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Lawsuit Overview

Case Dismissed
Company
Rackable Systems, Inc.
Security
NASDAQ: RACK

Case Name
Rackable Systems Shareholder Class Action Lawsuit 01/16/2009
Type of Lawsuit
Shareholder Class Action
Court of Filing
U.S. District Court for the Northern District of California

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

August 31, 2010 - The court entered a judgment in favor of the defendants.
August 27, 2010 - The court granted defendants' motion to dismiss with prejudice.

April 9, 2010 - Defendants filed a motion to dismiss.

February 3, 2010 - The lead plaintiff filed a second amended complaint.

January 13, 2010 - The court granted defendants' motion to dismiss.

August 13, 2009 - Defendants filed a motion to dismiss.

June 15, 2009 - The lead plaintiff filed an amended complaint.

April 16, 2009 - Lead plaintiff and lead counsel were appointed.

March 17, 2009 - Lead plaintiff motion was filed.

January 16, 2009 - An investor in shares of Rackable Systems Inc (NASDAQ: RACK) filed a lawsuit in the U.S. District Court for the Northern District of California against Rackable Systems Inc over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between October 30, 2006 and April 4, 2007.

According to the complaint the plaintiff alleges that Rackable Systems Inc (NASDAQ: RACK) and certain of its former executive officers violated federal securities laws issuing between October 30, 2006 and April 4, 2007 materially false and misleading public statements concerning Rackable Systems Inc's business, operations and prospects.

On January 16, 2007 Rackable Systems Inc reported preliminary financial results for fourth quarter 2006 and that Rackable Systems Inc had achieved a gross margin of between only 19.2% and 19.7%. On this news, shares of Rackable Systems Inc (NASDAQ: RACK) declined $12.44 per share, more than 38%, to close on January 17, 2007, at $19.98 per share, on unusually heavy trading volume. Then on February 1, 2007, Rackable Systems Inc (NASDAQ: RACK) shares continued their downward slide when Rackable Systems Inc announced its fourth quarter financial results and reported a non-GAAP gross margin of 19.8%, a significant reduction from 24.9% for the same period in the prior year. On this news, shares of Rackable Systems Inc (NASDAQ: RACK) declined an additional $3.65 per share, nearly 18%, to close on February 2, 2007, at $16.69 per share.

On April 4, 2007 Rackable Systems Inc revealed that its GAAP and non-GAAP gross margins for first quarter 2007 would be approximately 30% lower than its previously communicated expectations and that the primary factor impacting gross margins in the first quarter was the intensity of competition in Rackable Systems Inc's three largest accounts. On this news, so the lawsuit, shares of Rackable Systems Inc declined $2.64 per share, more than 15%, to close on April 5, 2007, at $14.24 per share, on unusually heavy volume.