On June 7, 2018, Pomerantz LLP was appointed Co-Lead Counsel in a class action lawsuit against Cemex, S.A.B. de C.V. (“Cemex” or the “Company”) and certain of its officers. The class action, filed in United States District Court, Southern District of New York, and docketed under 18-cv-02352, is on behalf of a class consisting of investors who purchased or otherwise acquired Cemex American Depositary Receipts (“ADRs”) between August 14, 2014 and March 13, 2018, both dates inclusive (the “Class Period”). Plaintiff seeks to recover compensable damages caused by Defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder.
Cemex is a global building materials company that produces, distributes, and markets cement, ready-mix concrete, aggregates, and related building materials. Cemex operates throughout the Americas, Europe, Africa, the Middle East, and Asia.
The complaint alleges that throughout the Class Period, defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Cemex executives had engaged in an unlawful bribery scheme in connection with the Company’s business dealings in Colombia; (ii) discovery of the foregoing conduct would likely subject the Company to heightened regulatory scrutiny and potential criminal sanctions; (iii) the Company lacked adequate internal controls over financial reporting; and (iv) as a result, Cemex’s public statements were materially false and misleading at all relevant times.
On September 23, 2016, post-market, Cemex disclosed the Company’s dismissal of two senior executives after an internal probe found that payments worth $20 million relating to a land deal in Colombia had breached company protocols.
On this news, Cemex’s American depositary receipt (“ADR”) price fell $0.17, or 2.28%, to close at $7.26 on September 26, 2016.
On December 9, 2016, Cemex disclosed receipt of a subpoena from the U.S. Securities and Exchange Commission seeking information about irregular payments made at the Company’s Colombia unit.
Then, on March 14, 2018, Cemex disclosed that the U.S. Department of Justice is investigating the Company over payments made by the Company related to a cement plant it is building in Colombia to determine whether any violations of federal bribery laws occurred.
On this news, Cemex’s ADR price fell $0.12, or 1.64%, to close at $7.21 on March 14, 2018.