The Law Offices of Frank R. Cruz Announces the Filing of a Securities Class Action on Behalf of Rekor Systems, Inc. f/k/a Novume Solutions, Inc. (REKR) Investors
LOS ANGELES--(BUSINESS WIRE)--Jul 1, 2021--
The Law Offices of Frank R. Cruz announces that a class action lawsuit has been filed on behalf of persons and entities that purchased or otherwise acquired Rekor Systems, Inc. f/k/a Novume Solutions, Inc. (“Rekor” or the “Company”) (NASDAQ: REKR ) securities between April 12, 2019 and May 25, 2021, inclusive (the “Class Period”). Rekor investors have until August 30, 2021 to file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here to participate.
On May 10, 2021, a Texas bill authorizing the establishment of a state uninsured vehicle enforcement diversion (“UVED”) was left pending in state committee, leading to significant market speculation that the bill was dead. The same day, during a conference call, Rekor indicated that the Company may not secure a UVED agreement with Texas.
On this news, the Company’s stock price fell $5.20, or 27.5%, to close at $13.71 per share on May 10, 2021, thereby injuring investors. The stock price continued to decline during the next trading session by $2.45, or nearly 18%, to close at $11.26 per share on May 11, 2021.
Then on May 26, 2021, Western Edge published a report entitled “Rekor Systems: Lackluster Growth Runway and Exaggerated Insurance Scheme Raise Substantial Downside Risk,” alleging, among other things, that the Company’s “realized results suggest management’s potential revenue guidance could be overstated by up to 80%.” The report also noted that Rekor’s predecessor in the Oklahoma UVED partnership had exited it because “the program is not economically feasible.”
The same day, Mariner Research Group published a report entitled “REKR - Government documents do not support investor expectations.” According to the report, “government documentation . . . shows that REKR’s revenue opportunities are likely a fraction of what investors expect.” For example, “Oklahoma government budgets imply that REKR’s much vaunted UVED program is a sub $2MM revenue opportunity--almost 96% less than the > $40MM in revenue intimated by Rekor’s CEO.”
On this news, Rekor’s stock price fell $0.44 per share, or 3.93%, to close at $10.77 per share on May 26, 2021.
The complaint filed alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) Rekor’s automatic license plate recognition (“ALPR”) technology and UVED-related business is outclassed by global competitors with an established, dominant market share; (2) it was unlikely that states would pass legislation authorizing deals similar to Rekor’s Oklahoma UVED partnership because of, inter alia, state and local privacy laws and related public concerns; (3) Rekor’s UVED partnership was not as profitable as Defendants had led investors to believe because of known impediments to enrollment rates and costs associated with the partnership; (4) accordingly, Rekor had overstated its potential revenues, profitability, and overall ALPR- and UVED-related business prospects; and (5) as a result, Defendants’ statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.
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If you purchased Rekor securities during the Class Period, you may move the Court no later than August 30, 2021 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased Rekor securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to email@example.com, or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
View source version on businesswire.com:https://www.businesswire.com/news/home/20210701005925/en/
CONTACT: The Law Offices of Frank R. Cruz, Los Angeles
Frank R. Cruz, 310-914-5007
KEYWORD: CALIFORNIA UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: LEGAL PROFESSIONAL SERVICES
SOURCE: The Law Offices of Frank R. Cruz
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PUB: 07/01/2021 05:19 PM/DISC: 07/01/2021 05:19 PM