Philadelphia, Pennsylvania--(Newsfile Corp. - September 14, 2023) - Berger Montague advises investors that a securities fraud class action lawsuit has been filed against DigitalOcean Holdings, Inc. ("DigitalOcean") (NYSE: DOCN) on behalf of those who purchased DigitalOcean securities between February 16, 2023 and August 25, 2023, inclusive (the "Class Period").
Investor Deadline: Investors who purchased or acquired DigitalOcean securities during the Class Period may, no later than November 13, 2023, seek to be appointed as a lead plaintiff representative of the class. For additional information or to learn how to participate in this litigation, please contact Berger Montague: James Maro at [email protected] or (267) 637-3176, or Andrew Abramowitz at [email protected] or (215) 875-3015 or visit: https://investigations.bergermontague.com/digital-ocean-holdings/
DigitalOcean is an emerging growth company which purports to offer a cloud computing platform, primarily for small to medium-sized businesses who lack adequate resources to support on-premise software development environments. DigitalOcean's customers use its platform for building web and mobile applications, website hosting, and e-commerce, among other uses.
On August 3, 2023, DigitalOcean announced that it had "identified certain errors within the unaudited condensed consolidated financial statements for the quarter ended March 31, 2023" related to DigitalOcean's accounting for income tax expense. This resulted in an overstatement of income tax expense in the quarter of approximately $18 million. DigitalOcean announced that it would be restating its first quarter 2023 financials, and that this restatement would "also include disclosure of an identified material weakness and that our disclosure controls and procedures were not effective as of March 31, 2023."
Following this, DigitalOcean's stock price declined $11.57 per share, or approximately 24.8%, to close at $35.11 per share on the following trading day, August 4, 2023.
Then, on August 24, 2023, DigitalOcean issued a press release announcing that the company's Board of Directors had begun a search for a new CEO to replace Defendant Yancey Spruill, who would step down as CEO and board member as soon as his successor was appointed.
Following this news, DigitalOcean's stock price declined $2.65 per share, or approximately 8.4%, on unusually heavy trading volume to close at $28.86 per share on the following trading day, August 25, 2023.
The complaint alleges that, throughout the Class Period, the defendants failed to disclose to investors that: (1) the defendants lacked the skills and experience to assess complicated tax matters and therefore did not design or maintain effective controls over the company's accounting for income taxes; and (2) as a result of the foregoing, the defendants' financial statements during the Class Period were inaccurate and materially misleading.
A lead plaintiff is a representative party who acts on behalf of all class members in directing the litigation. The lead plaintiff is usually the investor or small group of investors who have the largest financial interest and who are also adequate and typical of the proposed class of investors. The lead plaintiff selects counsel to represent the lead plaintiff and the class and these attorneys, if approved by the court, are lead or class counsel. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the Court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.
Whistleblowers: Anyone with non-public information regarding DigitalOcean is encouraged to confidentially assist Berger Montague's investigation or take advantage of the SEC Whistleblower program. Under this program, whistleblowers who provide original information may receive rewards totaling up to thirty percent (30%) of recoveries obtained by the SEC. For more information, contact us.
Berger Montague, with offices in Philadelphia, Minneapolis, Washington, D.C., San Diego, San Francisco, Chicago, and Delaware has been a pioneer in securities class action litigation since its founding in 1970. Berger Montague has represented individual and institutional investors for over five decades and serves as lead counsel in courts throughout the United States.
James Maro, Senior Counsel
Andrew Abramowitz, Senior Counsel
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/180620