Chupa v. Armstrong Flooring, Inc.
On March 2, 2020 the Court appointed Bernstein Liebhard LLP as Lead counsel in Chupa v. Armstrong Flooring Inc., No. 2:19-cv-09850-CAS (C.D. Cal.) on behalf of Lead Plaintiff and the putative class. After a thorough investigation, Lead Plaintiff filed an amended complaint on July 2, 2020 alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (“Exchange Act”), and Rule 10b-5 promulgated thereunder, against Armstrong Flooring, Michel Vermette, Donald Maier, Larry McWilliams, Douglas Bingham, Dominic Rice, and Ronald Ford. The amended complaint alleged that during the Class Period (March 6, 2018 through March 3, 2020) Armstrong Flooring violated the federal securities laws by misrepresenting to investors: (i) that the Go-To-Market Strategy was proceeding well; (ii) the inventory levels in Armstrong Flooring’s sales channels; and (iii) the service being provided to the Company’s commercial and national accounts. Lead Plaintiff claimed that these misrepresentations caused investors to pay inflated prices for Armstrong common stock purchased during the Class Period.
The Defendants filed four separate motions to dismiss the amended complaint on August 17, 2020. Lead Plaintiff filed an omnibus memorandum in opposition to the Defendants’ motions on October 1, 2020. While the motion to dismiss briefing was ongoing, the Parties attempted to resolve the Action through a confidential mediation with a respected JAMS mediator. After a full day of arm’s-length negotiations, the Parties did not reach an agreement.
On November 2, 2020, Armstrong Flooring, Michel Vermette, Dominic Rice, and Larry Williams filed a reply brief in support of their motion to dismiss. The three other Individual Defendants each filed a reply brief in support of their respective motions to dismiss. During the weeks that followed, the Parties continued to engage in settlement negotiations through the mediator. Then, on November 30, 2020, just seven days before the scheduled oral argument on the Defendants’ Motions to Dismiss, the Parties agreed to a settlement in principle to release all claims against Defendants in return for a cash payment of three million seven hundred fifty thousand dollars ($3,750,000) for the benefit of the Settlement Class.