An investor in NYSE:RAX shares filed a lawsuit over alleged Securities Laws violations by Rackspace Hosting, Inc.
Investors who purchased shares of Rackspace Hosting, Inc. (NYSE:RAX should contact the Shareholders Foundation at email@example.com or call +1(858) 779 – 1554.
The plaintiff claims that the defendants violated provisions of the Exchange Act by issuing false and misleading statements regarding the impending loss of its contract with Vodafone Group Plc and the attendant impact on the Company’s profitability and growth prospects.
In August 2010, Rackspace announced that its Vodafone Group Plc Contract had been renewed for an additional five years.
More specifically, the plaintiff claims that between November 11, 2014 and August 10, 2015 the defendants’ statements pertaining to the Company’s profitability and growth prospects were materially false and misleading because Defendants failed to disclose that Vodafone Group Plc had initiated extensive data migration away from Rackspace servers, signaling Vodafone’s intent to replace Rackspace with alternative providers on the contract’s April 1, 2015 expiration date, that the failure to secure a renewal of the Vodafone Contract would have a significant near-term financial impact on the Company’s 2015 recurring revenues, and that as a result of the foregoing, Defendants lacked a reasonable basis for their positive statements about the Company and its growth prospects.
Beginning in May 2015, a series of disclosures exposed the non-renewal of the Vodafone Contract and its concomitant impact on Rackspace Hosting, Inc’s financial performance and business prospects. The plaintiff says that in reaction to these revelations, Rackspace Hosting, Inc. (NYSE:RAX) stock lost hundreds of millions of dollars in market capitalization, with the Company’s stock price falling from high of nearly $56 per share on April 27, 2015, to close at $29.24 per share on August 11, 2015.
Those who purchased NYSE:RAX shares have certain options and should contact the Shareholders Foundation.
Shareholders Foundation, Inc.
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