Pomerantz LLP issued the following announcement on July 9.
POn July 6, 2018 Pomerantz LLP was appointed Lead Counsel in a class action lawsuit against Synacor, Inc. (“Synacor” or the “Company”) (SYNC) and certain of its officers. The class action, filed in United States District Court, Southern District of New York, and docketed under 18-cv-02979, is on behalf of a class consisting of investors who purchased or otherwise acquired Synacor securities between May 4, 2016 and March 15, 2018, both dates inclusive (the “Class Period”), seeking to recover damages caused by Defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.
Synacor operates as a technology development, multiplatform services, and revenue partner for video, Internet, and communications providers, as well as device manufacturers, governments, and enterprises.
On May 4, 2016, Synacor announced that it had secured a three-year contract to host web and mobile services for AT&T Inc. (“AT&T” and the “AT&T Contract,” respectively).
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Synacor was unlikely to receive significant revenues from the AT&T Contract until 2018; (ii) as such, the Company’s revenue forecasts issued during the Class Period were materially false and misleading; and (iii) as a result of the foregoing, Synacor shares traded at artificially inflated prices during the Class Period, and class members suffered significant losses and damages.
On August 9, 2017, post-market, Synacor issued a press release entitled “Synacor Exceeds Second-Quarter 2017 Financial Guidance; Remains on Path to ‘3/30/300,’” announcing its financial results for the quarter ended June 30, 2017. The press release stated in relevant part: “[T]he joint AT&T-Synacor team has made the strategic decision to prioritize portal engagement right now over monetization. We are seeing the results of this focus in deeper engagement metrics. We are already generating revenue from this new consumer experience, but we expect that additional monetization tactics will be turned on at a more deliberate pace, which will result in a longer ramp to full monetization. As a result, a significant portion of the revenue that we were expecting in Q3 and Q4 this year is delayed to 2018, and we are adjusting our financial guidance for 2017 accordingly. We believe that this engagement-focused strategy ultimately leads to a stronger, more sustainable business,” concluded Bhise.
On this news, Synacor’s share price fell $1.15, or 32.39%, to close at $2.40 on August 10, 2017.
On March 15, 2018, post-market, Synacor held a conference call with analysts and investors to discuss the Company’s fourth-quarter earnings. During the call, Defendant Bhise discussed the shortcomings of the AT&T contract.
On this news, Synacor’s share price fell $0.30, or 14.63%, to close at $1.75 on March 16, 2018.
Original source can be found here.