Baxter International, Inc. (BAX)


Faruqi & Faruqi, LLP Encourages Investors Who Suffered Losses Exceeding $50,000 In Baxter International, Inc. To Contact The Firm 

Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Baxter International, Inc. (“Baxter” or the “Company”) (NYSE:BAX) of the January 24, 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 Baxter stock or options between February 21, 2019 and October 23, 2019 and would like to discuss your legal rights, please fill out the form below. 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 rgonnello@faruqilaw.com.  

The lawsuit has been filed in the U.S. District Court for the Northern District of Illinois on behalf of all those who purchased Prudential securities between February 21, 2019 and October 23, 2019 (the “Class Period”).  The case, Silverman v. Baxter International Inc. et al, No. 19-cv-07786 was filed on November 25, 2019, and has been assigned to Honorable Sara L. Ellis

The lawsuit focuses on whether the Company and its executives violated federal securities laws by misrepresenting and/or failing to disclose that: (1) certain intra-Company transactions, undertaken for the purpose of generating foreign exchange gains and losses, used foreign exchange rate conventions that were not in accordance with GAAP and enabled intra-Company transactions to be undertaken after the related exchange rates were already known; (2) the Company lacked effective internal control over financial reporting; (3) as a result, the Company’s financial statements were misstated and would likely require correction or amendment; (4) due to the Company’s internal investigation, Baxter would not be able to file its quarterly report for the period ending September 30, 2019, with the SEC on Form 10-Q in a timely manner; and (5) as a result of the foregoing, Defendants’ statements about the Company’s business and operations lacked a reasonable basis.

Specifically, before the markets opened on October 24, 2019, Baxter announced that it “recently began an investigation into certain intra-Company transactions undertaken for the purpose of generating foreign exchange gains or losses.” According to the Company, “[t]hese transactions used a foreign exchange rate convention historically applied by the Company that was not in accordance with generally accepted accounting principles [(“GAAP”)] and enabled intra Company transactions to be undertaken after the related exchange rates were already known.”

Baxter further admitted that “[t]hese intra-Company transactions resulted in certain misstatements in the Company’s previously reported non-operating income related to net foreign exchange gains” and acknowledged that, “[u]pon completion of the investigation and the Company’s evaluation of the materiality of the misstatements, the Company expects to either amend its periodic reports previously filed with the SEC to include restated financial statements that correct those misstatements, or include in reports for future periods restated comparative financial statements that correct those misstatements.” As noted in the announcement, “the Company previously reported net foreign exchange gains of $8 million, $113 million, $28 million, $50 million, $73 million, and $22 million, for the years 2014, 2015, 2016, 2017, 2018, and the first half of 2019, respectively.”

The Company further explained that “[t]he Audit Committee of the Company’s Board of Directors is overseeing this investigation with the assistance of independent, experienced external advisors,” that “Baxter voluntarily advised the staff of the [SEC] that the internal investigation is underway and intends to provide additional information to the SEC as the investigation progresses,” and that “[t]he Company does not expect to file its quarterly report on Form 10-Q for the period ended September 30, 2019 on a timely basis.”

On this news, Baxter’s stock price fell from $87.95 on October 23, 2019 to a closing price of $79.08 on October 24, 2019—a $8.87 or 10.09% drop.

 

 

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Baxter International, Inc (BAX)

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Filed on 11/04/2019

Ticker NYSE:BAX

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