This is a securities fraud class action lawsuit against Sonic Solutions and certain of its officers and directors.
Sonic develops and markets computer software related to digital media, such as data, photographs, audio and video in digital formats.
The class action complaint alleges that Sonic had manipulated its stock option accounting which caused its SEC filings to be false. Also during the Class Period, Sonic and its top officers made false and misleading statements about its business and prospects, all while concealing its false stock option grant practices, causing its stock to trade at artificially inflated levels.
On February 1, 2007, Sonic announced that it had commenced a voluntary review of its historical and current stock option grant practices and related accounting. Then, on May 17, 2007, after the market closed, Sonic announced its preliminary unaudited financial results for the fourth quarter ended March 31, 2007, and stated that based on its previous review, Sonic lacked sufficient documentation for certain historical option grants and that the measurement dates associated with these option grants will need to be adjusted. Sonic further stated that it will have to record additional cash and non-cash charges for stock-based compensation expense and restate previous financial statements, and that such charges will be material.
On this news, Sonic's stock collapsed from $13.37 per share to as low as $11.76 per share on volume of 1.8 million shares. This drop continued a decline from $18 per share which began in February 2007, when Sonic first disclosed its stock option problems.
Name (Stock Symbol)
Sonic Solutions, Inc. (SNIC)
Sonic Solutions engages in the development and marketing of computer software related to digital media for consumer and professional end users.
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