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Update:
- Fracking investors who alleged Liberty Oilfield Services Inc. misled them about the state of their finances ahead of its initial public offering have reached a $3.9 million settlement deal with the company.
- The settlement amount, which Liberty Oilfield’s insurer will pay, includes reimbursement of up to $65,000 in expenses and an award of up to $15,000 for the two named plaintiffs, according to court documents.
- The settlement class includes anyone who acquired Liberty common stock “either in or traceable to” the company’s January 2018 $220 million IPO through April 3, 2020.
- Liberty Oilfield Services Inc. does not admit any wrongdoing as part of the settlement.
Liberty Oilfield Investors Class Action Lawsuit Overview:
- Who: Fracking industry investors are asking a judge to certify a class action lawsuit filed against Liberty Oilfield Services Inc.
- Why: Investors claim Liberty misled its investors about the state of its finances ahead of its $220 million initial public offering in January 2018.
- Where: The class action lawsuit was filed in Colorado federal court.
(11/04/2021)
Fracking investors arguing Liberty Oilfield Services Inc. misled them about the state of their finances ahead of its initial public offering (IPO) are asking a Colorado federal court for Class certification.
Plaintiffs Cipriano Correa and Marc Joseph claim Liberty provided a registration statement that was false and misleading ahead of its $220 million IPO in January 2018.
Correa and Joseph argue a class action lawsuit is the best way to go forward since Liberty misled virtually all of its investors.
“The alternatives to a class action are either no recourse for thousands of stock purchasers or a multiplicity of suits throughout the United States, which would result in the inefficient administration of justice,” investors said.
Supply Surplus in the Fracking Industry Led to Reduced Sales, Class Action Lawsuit Alleges
Correa and Joseph claim Liberty specifically withheld from its registration statement that, at the time of its IPO, the fracking industry was dealing with a supply surplus due to how much capacity it was adding.
This surplus was limiting how much the company could charge for its service, investors say.
Correa and Joseph allege former employees of Liberty would later acknowledge the surplus had forced the company to “lower its prices and seek discounts from vendors.”
“The Registration Statement failed to disclose these material facts. Instead, the Registration Statement falsely described the fracking industry as contracting and falsely stated that Liberty was experiencing price increases,” investors said.
Correa filed the first amended complaint against Liberty in August 2020. The oil company’s subsequent attempt to get the class action lawsuit dismissed was largely denied by a judge in July of this year.
Another oilfield service company, SAExploration Holdings Inc., agreed to a $3.5 million settlement earlier this year to end claims it defrauded its investors by inflating its revenue by $141 million.
Were you misled about the state of Liberty’s finances prior to investing in the company? Let us know in the comments!
The plaintiffs are represented by Laurence M. Rosen, Michael A. Cohen, Phillip C. Kim and Yu Shi of The Rosen Law Firm PA.
The Liberty Oilfield Investors Class Action Lawsuit Correa, et al., v. Liberty Oilfield Services Inc. et al., Case No. 1:20-cv-00946, in the U.S. District Court for the District of Colorado.
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