Legal Proceedings.
−Removed: Various labor and employment lawsuits were filed by former employees against FUSO, NBT, and HRT, alleging these entities failed to provide proper meal and rest breaks, as well as other related violations.
−Removed: These entities deny all the allegations.
−Removed: Management believes there is no merit to the cases and will vigorously defend the cases.
−Removed: Therefore, the Company did not accrue any loss contingency for these matters on its consolidated financial statements as of June 30, 2020 and 2019.
+Added: A labor and employment lawsuit was filed by a former employee against FUSO, alleging it failed to provide proper meal and rest breaks, as well as other related violations.
+Added: FUSO believes there is no merit to the case and vigorously defending against all the allegations.
+Added: Therefore, the Company did not accrue any loss contingency for these matters on its consolidated financial statements as of September 30, 2020 and December 31, 2019.
On March 29, 2020, plaintiff Jesus Mendoza (“Mendoza”) filed a putative shareholder securities class action lawsuit (the Class Action Lawsuit”) in the United States District Court for the Central District of California against the Company and certain of its present and former officers (collectively, the “Class Action Defendants”) for alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 styled Mendoza v.
5 unchanged sentences
2:20-CV-3967-ODW-JPR (C.D.
−Removed: The Ponce-Sanchez Lawsuit has now been consolidated with the Class Action Lawsuit and a motion for lead plaintiff and lead plaintiff’s counsel is pending.
+Added: The Ponce-Sanchez Lawsuit has now been consolidated with the Class Action Lawsuit and both cases will proceed under the Class Action Lawsuit docket.
The complaints both allege that the Defendants made materially false and (or) misleading statements that caused losses to investors.
1 unchanged sentence
Neither complaint quantifies any alleged damages, but, in addition to attorneys’ fees and costs, they seek to recover damages on behalf of themselves and other persons who purchased or otherwise acquired Company stock during the putative class period from August 23, 2018 through March 23, 2020 at allegedly inflated prices and purportedly suffered financial harm as a result.
+Added: On October 13, 2020, the Court appointed Yun F.
+Added: Yee as lead plaintiff and approved Mr.
+Added: Yee’s counsel as lead counsel in the Class Action Lawsuit.
+Added: On October 28, 2020, the Court entered a scheduling order setting December 4, 2020 as the deadline for lead plaintiff to file the Consolidated Amended Complaint and setting a schedule for Defendants' anticipated motion to dismiss.
+Added: The Class Action Lawsuit does not quantify any alleged damages.
The Company disputes these allegations and intends to defend the consolidated actions vigorously.
−Removed: At this stage, the Company is unable to determine whether a future loss will be incurred due to the consolidated actions.
On June 15, 2020, Mendoza filed a shareholder derivative lawsuit on behalf of the Company as a nominal defendant (the “Mendoza Derivative Lawsuit”) in the United States District Court for the Central District of California against certain of the Company’s present and former directors and officers (collectively, the “Mendoza Derivative Defendants”) styled Mendoza v.
−Removed: Zhou Min Ni, et al.
−Removed: , Civil Action No.
+Added: Zhou Min Ni, et al., Civil Action No.
2:20-CV-5300-ODW-JPR (C.D.
−Removed: The complaint in the Mendoza Derivative Lawsuit is based largely on the same allegations set forth in the Class Action Lawsuit discussed above and alleges violations of Sections 10(b), 14(a), and 20(a) of the Securities Exchange Act of 1934, breach of fiduciary duties , unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets.
+Added: The complaint in the Mendoza Derivative Lawsuit is based largely on the same allegations as set forth in the Class Action Lawsuit discussed above and alleges violations of Sections 10(b), 14(a), and 20(a) of the Securities Exchange Act of 1934, breach of fiduciary duties , unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets.
The Mendoza Derivative Lawsuit does not quantify any alleged damages, but, in addition to attorneys’ fees and costs, Mendoza seeks to recover damages on behalf of the Company for purported financial harm and to have the court order changes in the Company’s corporate governance.
1 unchanged sentence
On July 8, 2020, the Court ordered that all proceedings in the Mendoza Derivative Lawsuit be stayed until such time as the Court has finally resolved the Mendoza Defendants’ anticipated motion to dismiss the Class Action Lawsuit.
−Removed: At this stage, the Company is unable to determine whether a future loss will be incurred due to the Mendoza Derivative Lawsuit.
+Added: At this stage, the Company is unable to determine whether a future loss will be incurred due to the consolidated Class Action Lawsuit or the Mendoza Derivative Lawsuit, or estimate a range of loss, if any;
+Added: accordingly, no amounts have been accrued in the Company’s financial statements as of September 30, 2020.
+Added: On August 21, 2020, Plaintiff Jim Bishop filed a putative shareholder derivative lawsuit (the “Bishop Lawsuit”) in the United States District Court for the District of Delaware against certain of the Company’s present and former directors and officers, as well as the Company (collectively, the “Bishop Defendants”) styled Jim Bishop v.
+Added: Zhou Min Ni, et al.
+Added: , Civil Action No.
+Added: 1:20-cv-01103-RGA (D.
+Added: The Bishop Lawsuit complaint alleges claims that are virtually the same as those alleged in the Mendoza II Lawsuit.
+Added: The Bishop Lawsuit does not quantify any alleged damages.
+Added: But in addition to attorneys’ fees and costs, Mr.
+Added: Bishop seeks to recover damages on behalf of the Company for purported financial harm and to have the Court order changes to the Company’s corporate governance.
+Added: The Bishop Defendants will seek to have the Bishop Lawsuit stayed until such time as the Court has finally resolved the Mendoza Defendants’ anticipated motion to dismiss the securities class action claims in the consolidated Mendoza Lawsuit.
+Added: The Bishop Defendants and the Company dispute and intend to defend vigorously the allegations in the Bishop Lawsuit, assuming it proceeds.
+Added: On October 20, 2020, Mr.
+Added: Bishop and the Bishop Defendants filed a Joint Stipulation to Stay Litigation with the Court.
+Added: In response, the Court entered a docket order on October 21, 2020, indicating that the Bishop Lawsuit could have been brought in the Central District of California where the Mendoza Derivative Lawsuit is pending already, and directing that any party opposing a transfer of the case to the Central District of California should submit a brief in support of that position by November 4, 2020.
+Added: The Court further directed that the Bishop Defendants do not need to respond to the complaint until the transfer issue is resolved.
+Added: This case remains in early procedural posture.At this stage, the Company is unable to determine whether a future loss will be incurred due to the Bishop Lawsuit or estimate a range of loss, if any;
+Added: accordingly, no amounts have been accrued in the Company’s financial statements as of September 30, 2020.
+Added: The United States Securities and Exchange Commission (“SEC”) has initiated a formal, non-public investigation of the Company, and the SEC issued a request for a variety of documents and other information.
+Added: The document request relates to a range of matters including, but not limited to, the matters identified in the Ponce-Sanchez Lawsuit and the Mendoza Derivative Lawsuit.
+Added: We are cooperating with the SEC in its investigation.
+Added: Prior to receiving the document request from the SEC, the Company's board of directors appointed a special committee of independent directors to investigate the the matters identified in the Ponce-Sanchez Lawsuit and the Mendoza Derivative Lawsuit.
+Added: The SEC and independent committee investigations are in process and no conclusions have been reached.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.