Troubles continue to mount for San Francisco-based electric vehicle charging equipment company Ecotality with the news an Atlanta legal firm has launched a class action lawsuit against it on behalf of investors.
Holzer Holzer and Fistel’s action says investors who bought common stock in Ecotality between April 16 and August 9 were misled by a series of statements during that time which were false and misleading.
The lawsuit alleges Ecotality failed to disclose problems that were causing its chargers to overheat and melt whilst in use and that the companys efforts to change from installations subsidized by the U.S. Department of Energys EV Project to unsubsidized commercial sales were not bringing in enough to sustain operations from July onwards.
The suit also alleges Ecotality failed to reveal a new model of its industrial Minit Charger, due for release in the second half of this year, was behind schedule because of unacceptable performance shortfalls during prototype verification testing.
The suit claims the company failed to admit the Energy Department was ready to pull funding because of its inability to meet its EV Project commitments and also failed to disclose its liability for an US$855,000 payment to the federal Department of Labor for back pay and damages relating to non-compliance with U.S. labor law.
Holzer Holzer and Fistel announced the suit last Tuesday and is encouraging people who bought shares in Ecotality during the period in question to come forward with a deadline for registering as a lead plaintiff in the lawsuit on October 14.
A statement on the Ecotality website labelled "An Important Message" and released on August 12, reads: "We wanted you to know that the needs of our drivers are paramount to us and despite the challenges we currently face, we will continue to operate the Blink Network and maintain our Blink chargers until further notice. We urge you to visit a Blink charger today and show that you support the growth of a public charging infrastructure."
New York legal firm Harwood Feffer yesterday (Monday) announced that it too will be investigating a potential claim on behalf of Ecotality shareholders against the company.
The Madison Avenue firm announced it is investigating potentially false and misleading claims by Ecotality in connection with a $100 million loan from the U.S. treasury in 2009.
The legal firm has asked Ecotality shareholders to contact it with further information.