Robbins Geller Rudman & Dowd LLP Files Class Action Suit Against CPI Card Group Inc.

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Jun 15, 2016, 06:31 ET

NEW YORK, June 15, 2016 /PRNewswire/ -- Robbins Geller Rudman & Dowd LLP ("Robbins Geller") (http://www.rgrdlaw.com/cases/cpiinc/) today announced that a class action has been commenced on behalf of purchasers of CPI Card Group Inc. ("CPI" or the "Company") (NASDAQ:PMTS) common stock in connection with CPI's October 8, 2015 initial public offering ("IPO"), including purchasers of the common stock in the aftermarket. This action was filed in the Southern District of New York and is captioned Vance v. CPI Card Group Inc., No. 1:16-cv-04531.

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, David A. Rosenfeld or Andrew L. Schwartz of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at [email protected]. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/cpiinc/. 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.

The complaint charges CPI, certain of its officers and directors, the underwriters of CPI's IPO and certain selling shareholders with violations of the Securities Act of 1933. CPI is a leading provider of payment card production and related services, offering a single source for credit, debit and prepaid debit cards, including "EMV" (Europay, MasterCard and Visa) chip, personalization, instant issuance, fulfillment and mobile payment services. CPI markets its products and services to national and regional banks, independent community banks, credit unions, managers of prepaid programs, group service providers, and card processors through field-based sales representatives in North America, Western Europe, the United Kingdom and Canada.

The complaint alleges that at the time of the IPO, unbeknownst to investors, the Company had shipped upwards of 100 million more cards to its larger issuer customers than they were using in the second quarter and first part of the third quarter of 2015, resulting in the buildup of a massive backlog with those customers, which was significantly reducing the demand for additional card shipments in the fourth quarter of 2015 and fiscal 2016. The adverse events and uncertainties associated with CPI's largest customers' inventory levels was reasonably likely to have a material impact on CPI's profitability and, therefore, was required to be disclosed in the Registration Statement, but was not.

The IPO was successful for the Company, the selling stockholders and the underwriters who sold 17.25 million shares of CPI common stock at $10 per share, raising $172.5 million in gross proceeds. At the time of the filing of the complaint, CPI common stock was trading at about $4.70 per share – 53% less than the IPO price.

Plaintiff seeks to recover damages on behalf of all purchasers of CPI common stock in or pursuant to CPI's October 8, 2015 IPO, including purchasers of the common stock in the aftermarket (the "Class"). The plaintiff is represented by Robbins Geller, which has extensive experience in prosecuting investor class actions including actions involving financial fraud.

Robbins Geller is widely recognized as one of the leading law firms advising U.S. and international institutional investors in securities litigation and portfolio monitoring. With 200 lawyers in 10 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history and was ranked first in both the total amount and number of shareholder class action recoveries in ISS's SCAS Top 50 Report for the last two years. Robbins Geller attorneys have shaped the law in the areas of securities litigation and shareholder rights and have recovered tens of billions of dollars on behalf of the Firm's clients. Robbins Geller not only secures recoveries for defrauded investors, it also strives to implement corporate governance reforms, helping to improve the financial markets for investors worldwide. Please visit rgrdlaw.com/cases/cpi/ for more information.

Contact:
Robbins Geller Rudman & Dowd LLP
David A. Rosenfeld, 800-449-4900
Andrew L. Schwartz
[email protected]

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SOURCE Robbins Geller Rudman & Dowd LLP