Diamond Foods to pay $96 million to settle shareholder lawsuit

n">(Reuters) - Diamond Foods Inc (DMND.O) will pay about $96 million to settle a lawsuit related to the restatement of its results after an accounting scandal rocked the maker of Emerald Nuts and Kettle Chips last year.

Shares of the company, which also forecast higher-than-expected fourth-quarter sales, rose as much as 20 percent in morning trading on the settlement of the class action lawsuit.

Diamond said it will pay $11 million in cash and issue 4.45 million common shares to a fund to settle the lawsuit against the company and two of its former officers.

According to court documents, the settlement amount, subject to court approval, represents about 25-40 percent of what the lead plaintiffs saw as the maximum damages theoretically recoverable in this case.

Diamond has been trying to get past the scandal that claimed the jobs of its two top executives and caused its planned purchase of Pringles from Proctor & Gamble (PG.N) to fall apart.

The scandal, involving improper accounting of payments to walnut farmers, also led to the restatement that wiped out $56.5 million in profit from fiscal 2010 and 2011.

The company said on Wednesday it denies any wrongdoing related to the claims, which were made on behalf of investors who acquired Diamond stock between October 5, 2010 and February 8, 2012.

Diamond also forecast sales of $196 million to $201 million in the fourth quarter.

Analysts on average were expecting sales of $187.4 million, according to Thomson Reuters I/B/E/S.

The company's shares, which have risen about 40 percent this year, were up 16 percent at $22.27 on Wednesday on the Nasdaq.

The case is Re Diamond Foods Securities Litigation, case number 3:11-cv-05386, in the U.S. District Court for the Northern District of California.

(Reporting by Chris Peters in Bangalore)

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Diamond Foods to pay $96 million to settle shareholder lawsuit

n">(Reuters) - Diamond Foods Inc (DMND.O) will pay about $96 million to settle a lawsuit related to the restatement of its results after an accounting scandal rocked the maker of Emerald Nuts and Kettle Chips last year.

Shares of the company, which also forecast higher-than-expected fourth-quarter sales, rose as much as 20 percent in morning trading on the settlement of the class action lawsuit.

Diamond said it will pay $11 million in cash and issue 4.45 million common shares to a fund to settle the lawsuit against the company and two of its former officers.

According to court documents, the settlement amount, subject to court approval, represents about 25-40 percent of what the lead plaintiffs saw as the maximum damages theoretically recoverable in this case.

Diamond has been trying to get past the scandal that claimed the jobs of its two top executives and caused its planned purchase of Pringles from Proctor & Gamble (PG.N) to fall apart.

The scandal, involving improper accounting of payments to walnut farmers, also led to the restatement that wiped out $56.5 million in profit from fiscal 2010 and 2011.

The company said on Wednesday it denies any wrongdoing related to the claims, which were made on behalf of investors who acquired Diamond stock between October 5, 2010 and February 8, 2012.

Diamond also forecast sales of $196 million to $201 million in the fourth quarter.

Analysts on average were expecting sales of $187.4 million, according to Thomson Reuters I/B/E/S.

The company's shares, which have risen about 40 percent this year, were up 16 percent at $22.27 on Wednesday on the Nasdaq.

The case is Re Diamond Foods Securities Litigation, case number 3:11-cv-05386, in the U.S. District Court for the Northern District of California.

(Reporting by Chris Peters in Bangalore)

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U.S. judge dismisses Netflix shareholder lawsuit over streaming

By Jonathan Stempel

Wed Aug 21, 2013 12:01pm EDT

n">(Reuters) - Netflix Inc shareholders failed to persuade a federal judge to order the dominant U.S. video rental and streaming company to pay damages for misleading them about business prospects for its streaming operations.

U.S. District Judge Samuel Conti in San Francisco dismissed a lawsuit by shareholders led by the Arkansas Teacher Retirement System and State-Boston Retirement System on Tuesday, saying they failed to fix shortcomings in an earlier version of the suit he dismissed in February.

He said shareholders did not deserve a third chance to pursue the lawsuit, which began in January 2012, soon after Netflix suffered heavy subscriber losses, and its share price plunge.

"All of plaintiffs' allegations - new and old - depend on the tenuous theory that defendants withheld discrete and accurate financial information about streaming while also touting streaming's profitability," Conti wrote. "The court has not found this to be the case."

Stephen Tountas, a partner at Labaton Sucharow for the plaintiffs, did not immediately respond to requests for comment.

Shareholders accused Netflix of misleading them about pricing trends and the relative profitability of its streaming and DVD businesses, while insiders like Chief Executive Reed Hastings sold millions of dollars in company stock.

Netflix's share price fell 76 percent from early July to late October 2011 as the company lost 800,000 U.S. subscribers, set plans to spin off its DVD business, then quickly abandoned the idea.

Much of the decline stemmed from Hastings' decision to scrap a plan that let subscribers stream movies and receive DVDs for $9.99 per month, and instead offer separate streaming- and DVD-only subscriptions for $7.99 per month each.

Netflix later said it acted too quickly and did not explain the issue of rising costs to obtain streaming content well enough.

To keep their case alive, the shareholders cited several new statements from Hastings, other defendants and a confidential witness who they said showed Netflix knew streaming would be less profitable than advertised.

But the judge said statements such as Hastings' assertion in December 2010 that "there is no risk of a big negative thing happening to Netflix" did not support a securities fraud claim.

"Defendants made clear throughout the class period that the success of a streaming-focused business model was contingent on other factors, primarily the growth and retention of Netflix's subscriber base," he said.

Netflix reported more than 37 million streaming customers at the end of June.

Its share price has roughly tripled this year, helped by subscriber growth and its original programs, such as "Arrested Development" and "House of Cards," which last month won 14 Emmy nominations.

Netflix shares fell nearly 2 percent to $268.30 on Wednesday.

Joris Evers, a Netflix spokesman, said the company was pleased with Conti's decision.

The case is In re: Netflix Inc Securities Litigation, U.S. District Court, Northern District of California, No. 12-00225.

(Reporting by Jonathan Stempel in New York; Editing by Jeffrey Benkoe)

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Diamond Foods to pay $96 million to settle shareholder lawsuit

n">(Reuters) - Diamond Foods Inc (DMND.O) will pay about $96 million to settle a lawsuit related to the restatement of its results after an accounting scandal rocked the maker of Emerald Nuts and Kettle Chips last year.

Shares of the company, which also forecast higher-than-expected fourth-quarter sales, rose as much as 20 percent in morning trading on the settlement of the class action lawsuit.

Diamond said it will pay $11 million in cash and issue 4.45 million common shares to a fund to settle the lawsuit against the company and two of its former officers.

According to court documents, the settlement amount, subject to court approval, represents about 25-40 percent of what the lead plaintiffs saw as the maximum damages theoretically recoverable in this case.

Diamond has been trying to get past the scandal that claimed the jobs of its two top executives and caused its planned purchase of Pringles from Proctor & Gamble (PG.N) to fall apart.

The scandal, involving improper accounting of payments to walnut farmers, also led to the restatement that wiped out $56.5 million in profit from fiscal 2010 and 2011.

The company said on Wednesday it denies any wrongdoing related to the claims, which were made on behalf of investors who acquired Diamond stock between October 5, 2010 and February 8, 2012.

Diamond also forecast sales of $196 million to $201 million in the fourth quarter.

Analysts on average were expecting sales of $187.4 million, according to Thomson Reuters I/B/E/S.

The company's shares, which have risen about 40 percent this year, were up 16 percent at $22.27 on Wednesday on the Nasdaq.

The case is Re Diamond Foods Securities Litigation, case number 3:11-cv-05386, in the U.S. District Court for the Northern District of California.

(Reporting by Chris Peters in Bangalore)

View the original article here

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

U.S. judge dismisses Netflix shareholder lawsuit over streaming

By Jonathan Stempel

Wed Aug 21, 2013 12:01pm EDT

n">(Reuters) - Netflix Inc shareholders failed to persuade a federal judge to order the dominant U.S. video rental and streaming company to pay damages for misleading them about business prospects for its streaming operations.

U.S. District Judge Samuel Conti in San Francisco dismissed a lawsuit by shareholders led by the Arkansas Teacher Retirement System and State-Boston Retirement System on Tuesday, saying they failed to fix shortcomings in an earlier version of the suit he dismissed in February.

He said shareholders did not deserve a third chance to pursue the lawsuit, which began in January 2012, soon after Netflix suffered heavy subscriber losses, and its share price plunge.

"All of plaintiffs' allegations - new and old - depend on the tenuous theory that defendants withheld discrete and accurate financial information about streaming while also touting streaming's profitability," Conti wrote. "The court has not found this to be the case."

Stephen Tountas, a partner at Labaton Sucharow for the plaintiffs, did not immediately respond to requests for comment.

Shareholders accused Netflix of misleading them about pricing trends and the relative profitability of its streaming and DVD businesses, while insiders like Chief Executive Reed Hastings sold millions of dollars in company stock.

Netflix's share price fell 76 percent from early July to late October 2011 as the company lost 800,000 U.S. subscribers, set plans to spin off its DVD business, then quickly abandoned the idea.

Much of the decline stemmed from Hastings' decision to scrap a plan that let subscribers stream movies and receive DVDs for $9.99 per month, and instead offer separate streaming- and DVD-only subscriptions for $7.99 per month each.

Netflix later said it acted too quickly and did not explain the issue of rising costs to obtain streaming content well enough.

To keep their case alive, the shareholders cited several new statements from Hastings, other defendants and a confidential witness who they said showed Netflix knew streaming would be less profitable than advertised.

But the judge said statements such as Hastings' assertion in December 2010 that "there is no risk of a big negative thing happening to Netflix" did not support a securities fraud claim.

"Defendants made clear throughout the class period that the success of a streaming-focused business model was contingent on other factors, primarily the growth and retention of Netflix's subscriber base," he said.

Netflix reported more than 37 million streaming customers at the end of June.

Its share price has roughly tripled this year, helped by subscriber growth and its original programs, such as "Arrested Development" and "House of Cards," which last month won 14 Emmy nominations.

Netflix shares fell nearly 2 percent to $268.30 on Wednesday.

Joris Evers, a Netflix spokesman, said the company was pleased with Conti's decision.

The case is In re: Netflix Inc Securities Litigation, U.S. District Court, Northern District of California, No. 12-00225.

(Reporting by Jonathan Stempel in New York; Editing by Jeffrey Benkoe)

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Gulf Keystone Close To Ending Shareholder Row

The London-listed oil explorer Gulf Keystone Petroleum is on the brink of resolving a row with some of its leading shareholders with a deal that would avert a revolt against its new chairman.

Sky News understands Gulf Keystone is poised to announce that it will accept the nominations of four new independent directors to its board following a row over their credibility with investors led by M&G, the fund management arm of Prudential.

The quartet will include Jeremy Asher, a former director of the company, who quit the board several years ago after falling out with Todd Kozel, the chief executive.

Gulf Keystone recently labelled Mr Asher "a disruptive influence" and cast doubt on his professional credentials.

Under the proposed agreement, Gulf Keystone will also appoint at least two of its own candidates to join the board, including Philip Aiken, a former head of BHP Billiton's energy operations.

In return, the reform-minded shareholders, which also include Capital Research Global Investors, would agree to support the election of Simon Murray as Gulf Keystone's chairman, and the continued chairmanship of board committees by other directors.

The current chairman of the remuneration committee, Mehdi Varzi, and Ali al Qabandi, another non-executive director, would step down from the board, insiders said.

People close to the talks cautioned that the volatile nature of discussions in recent weeks between Gulf Keystone and its shareholders meant it was possible that the proposed deal could still fall apart.

If it does get signed off by the Gulf Keystone board, it would represent a welcome compromise for both sides in the wake of one of the ugliest corporate governance disputes at a major public company for some time.

Friday is the final day on which investors can submit votes for the annual meeting, which takes place in Bermuda later this month.

The rebel shareholders have been supported by a group of Malaysian investors and are confident that they will have sufficient backing to secure the election of their nominees.

Investors have long been unhappy with governance and pay at Gulf Keystone, which specialises in exploring for oil in Kurdistan but which has seen its share price fall sharply during the last year.

Mr Kozel has been a divisive figure at the helm of the company. People familiar with the situation said that his ex-wife, Ashley, was likely to use her roughly 17 million shares to vote against the company at the AGM.

Gulf Keystone has been one of the most controversially-governed companies on London's junior AIM market and scrutiny by shareholders has been intensified by the apparent intention to move its listing to the main market.

Mr Kozel's £8.8m award for 2012 actually represented a sharp decline on his pay in the previous year, which topped $22.2m (£14.4m).

Mr Kozel has sought to defend his remuneration by arguing that Gulf Keystone has delivered more than £1bn of value to shareholders and a return of more than 4,000% since the company's listing.

An ally of his said recently that the chairman's pay reflected an "overall balanced mix of remuneration and reflects exceptional performance for the year and confidence in future cash flows".

However, Gulf Keystone's shares have fallen sharply from highs triggered by takeover speculation, while it has also been embroiled in legal action brought by a former adviser which has claimed it is owed roughly £1bn in compensation.

Gulf Keystone declined to comment.

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