The machine tool maker, Hardinge Inc. has been hit with a class-action lawsuit, which says that they made misleading statements which inflated stock prices between February 2007 and February 2008. A California law firm filed the law suit in Rochester, NY.
Elmira, New York - Wednesday, the suit was filed with the Rochester U.S. District Court, by the Los Angeles law firm of Glancy Binkow & Goldberg LLP, with assistance from Rochester attorney Jules Smith of the Blitman & King law firm and attorney Howard Smith of Bensalem, Pa., by those stock holders that had purchased Hardinge stock during the time between Feb. 22, 2007, and Feb. 21, 2008.
The suit is claiming that during this time frame, stock prices paid had been affected by untrue statements and the value has since declined. The suit is looking to get compensatory damages that would be determined in court and other reasonable costs and expenses.Hardinge, Inc., makes a wide range of turning, milling, grinding products. Their product lines include:
> Precision, manual lathes to high-performance, Super-Precision multi-tasking CNC lathes;
> Manual knee mills to high-performance vertical and horizontal multi-tasking CNC machining centers;
> Precision manual to CNC type universal grinding machines for OD, face and ID grinding;
> Precision manual to CNC-type grinding machines for high-volume OD and ID production CNC grinding;
> Precision jig grinding and five axis profile grinding; and
> The world’s largest manufacturer of precision collets, chucks and workholding systems.
Named in the suit, are J. Patrick Ervin, Charles Trego Jr., and Edward Gaio. Ervin was chief executive officer until May, then he resigned. Trego was chief financial officer who resigned in March. Gaio was the company's comptroller but has since become the president and CFO.
The lawsuit alleges that the defendants failed to disclose that Hardinge orders and sales were slowing; that the slowing sales were causing Hardinge's inventory of outdated machinery to grow; that Hardinge failed to timely record the impairment in the value of its inventory and as a result, its financial results were inflated.
It is because of their actions, or lack of, led to inflated stock prices which had remained high until the oversights were disclosed. Then, the stock declined $4.16 per share, or 25.43 percent, to close on Feb. 21, 2008, at $12.20 per share, on unusually heavy trading volume.
District Judge Michael Telesca has been assigned to hear the case, and at this time the summonses have been issued, but not served.
CEO of Hardinge, Richard Simons, says that the company believes that this lawsuit is totally without merit. "We will work with our attorneys and insurance carrier to vigorously defend against the lawsuit," he said.
In the meantime, the California law firm is trying to track down anyone who had invested in the Hardinge stock during the time frame in question, so that they can be added to the lawsuit.