8:09 p.m., July 28
Local Firm Files Class Action Against Discount Chain
San Diego based Shareholders Foundation, Inc., which bills itself as “a professional loss-prevention, settlement recovery, portfolio monitoring service,” is pursuing a class action claim against directors and officers at Big Lots, Inc. of Ohio, operator of 11 Big Lots! discount stores in San Diego County.
Shareholders Foundation alleges that insider trading led to the illegal sale of hundreds of thousands of shares of Big Lots stock between March 6 and March 28, following an overly optimistic press release highlighting “record results” on March 2.
Following the stock market close on April 23, Big Lots issued another release revising its expected sales downward. The following day, the company’s stock plummeted from $45.65 to $34.71.
The investor filing the suit claims that the uncharacteristically large stock sales in March, immediately following the positive projection and just a few weeks in advance of the negative revision, “were based on their knowledge of material, non-public information concerning Big Lots’ true financial condition prospects, and thus were in breach of their fiduciary duties as officers and directors of Big Lots.”