Class action suit filed against Boulder Brands

BOULDER – Attorneys in Florida this week filed a class action lawsuit in U.S. District Court in Denver on behalf of affected Boulder Brands Inc. shareholders, alleging that the company issued false and misleading statements and failed to disclose certain adverse details related to the company’s financial health and outlook.

An official for Boulder-based Boulder Brands (Nasdaq: BDBD) said the company does not comment publicly about lawsuits.

Boulder Brands owns a variety of natural and organic food brands, including Evol, Udi’s Gluten Free, Earth Balance and Smart Balance.

The lawsuit, filed by the lawfirm of Robbins Geller Rudman and Dowd LLP in representation of plaintiff Ronald LoRusso, specifically aims to represent people who bought Boulder Brands common stock between Dec. 23, 2013 and Oct. 22, 2014.

It’s during that period that the plaintiff alleges misleading statements were made that overstated the financial well-being of the company and violated the Securities and Exchange Act of 1934.

On Oct. 22, Boulder Brands issued a press release to update its anticipated third-quarter results and outlook for 2014. Included in that day’s announcements were statements by company officials that the company had faced “a number of headwinds that impacted our financial results … resulting in a larger than expected decline,” the lawsuit states. Those headwinds included a mix-shift toward the company’s lower-margin Natural segment and lower shipments “due to a normalizing of certain inventories at our largest customer.”

The company’s stock dove more than 23 percent that day on the news, from $12.73 to $9.62. The stock fell another 6.55 percent to close at $8.99 the following day. The company’s stock had closed as high as $17.94 on April 2 of that year.

Attorneys for the plaintiff could not immediately be reached Thursday.

In addition to the company itself, Boulder Brands chief executive Stephen Hughes, chief operating officer James Leighton and chief financial officer Christine Sacco were also named in the suit.

Last month, Boulder Brands split its CEO and chairman of the board roles, with the board appointing R. Dean Hollis to replace Hughes as chairman.

Boulder Brands shares closed at $9.74 Thursday, up nearly 3 percent from the previous day.

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