NEW YORK - (NewMediaWire) - July 24, 2020 - Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Energy Recovery, Inc. ("Energy Recovery" or the "Company")(NASDAQ:ERII) of the September 22, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you invested in Energy Recovery stock or options between August 2, 2017 and June 29, 2020 and would like to discuss your legal rights, click here: www.faruqilaw.com/ERII. There is no cost or obligation to you.
You can also contact us by calling Richard Gonnello toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to email@example.com.
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The lawsuit has been filed in the U.S. District Court for the Southern District of New York on behalf of all those who purchased Energy Recovery common stock between August 2, 2017 and June 29, 2020 (the "Class Period"). The case, Visser v. Energy Recovery, Inc. et al., No. 20-cv-05647 was filed on July 21, 2020.
In December 2014, the Company launched the VorTeq hydraulic pumping system with the capability of isolating hydraulic fracturing pumps from abrasive proppants that cause pump failure. On October 19, 2015, the Company announced that it had signed a fifteen-year deal with Schlumberger Technology Corp. (“Schlumberger”), which gave Schlumberger the exclusive right to the use of the Company’s VorTeq technology (the “Schlumberger Licensing Agreement”). Under the terms of the Schlumberger Licensing Agreement, Schlumberger paid $75 million exclusivity fee and was to pay an additional $50 million milestone payments in 2016. The terms also dictated that Schlumberger would pay continuing annual royalties for the duration of the license agreement, subject to the satisfaction of certain key performance indicators.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by failing to disclose to investors that: (i) the Company and Schlumberger had different strategic perspectives regarding commercialization of VorTeq; (ii) which created substantial risk of early termination of the Company’s exclusive licensing agreement with Schlumberger; (iii) accordingly, the revenue guidance and expectations of future license revenue was false and lacked reasonable basis; and (iv) as a result, Defendants’ public statements were materially false and misleading at all relevant times or lacked a reasonable basis and omitted material facts.
On June 29, 2020, the Company issued a press release, announcing the termination of the licensing agreement with Schlumberger, citing to "different strategic perspectives as to the path to VorTeq commercialization." The Company further announced that following the termination, "no further payments will be made by either party" and that "Energy Recovery will now be fully responsible for commercialization of the VorTeq technology globally."
On this news, Energy Recovery's share price fell from $8.91 per share on June 29, 2020 to a closing price of $7.60 on June 30, 2020: a $1.31 or a 14.70% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Energy Recovery's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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