08182017Headline:

Baton Rouge, Louisiana

HomeLouisianaBaton Rouge

Email Staff Writer Staff Writer on LinkedIn Staff Writer on Twitter Staff Writer on Facebook
Staff Writer
Staff Writer
Contributor •

Shaw Group Class Action Lawsuit

Comments Off

In a complaint filed June 16, 2004, class action lawyers allege that Shaw Group, Inc. did not accurately represent its financial outlook for the period between October 19th 2000 and June 10, 2004. Shaw Group class action attorneys claim that, during that time, insiders at the company sold shaes of the company’s stock at inflated prices, earning over $80M in the process.

According to Stanford Law School’s Securities Class Action Clearinghouse,

The complaint alleges that the company also sold $490 million of convertible zero coupon liquid option notes during that period. The company’s revenue and earnings were inflated, the complaint says, because Shaw improperly established and drew on reserve accounts set up in connection with the acquisition of Stone & Webster Inc. and IT Group in 2002.

More specifically, the complaint alleges that such results were not prepared or reported in accordance with Generally Accepted Accounting Principles and deceived investors as to the Company’s true performance, thereby artificially inflating the price of Shaw securities during the Class Period. Specifically, the complaint alleges that the defendants artificially inflated the Company’s reported revenues and earnings by improperly establishing and drawing on reserve accounts established in connection with a series of large acquisitions, including the acquisition of Stone & Webster Inc. in July 2000 and the acquisition of The IT Group in May 2002. The complaint further alleges that defendants prematurely recognized revenue in violation of Shaw’s own purported policies and Generally Accepted Accounting Principles, and that defendants failed to disclose the extent to which Shaw was vulnerable to changes in power generation market conditions.

Read the whole Shaw Group Class Action summary.

The Shaw Group provides services for a variety of industries around the globe, including energy, environmental and infrastructure industries.