SAN FRANCISCO, Sept. 9, 2019 /PRNewswire/ -- Schubert Jonckheer
& Kolbe LLP is investigating potential derivative claims on
behalf of the shareholders of TrueCar, Inc. (NASDAQ: TRUE), related
to the company's statements regarding key affiliate USAA's website
redesign in June 2017.
TrueCar, which purports to provide prospective buyers with the
"true" market price for new and used cars, relies on affinity group
marketing partners for website traffic. These partnerships are
critical to TrueCar's unit sales growth and financial performance.
Historically, TrueCar's most important affinity partner has been
the United States Automobile Association ("USAA"), which has
generated nearly one-third of the company's annual unit sales and
revenues. As part of its close partnership with USAA, TrueCar
maintained and operated a co-branded car buying website with USAA.
However, when USAA decided to redesign the website in 2017 to
de-emphasize car purchasing and gather information about personal
finances, TrueCar lost substantial website traffic, ultimately
hurting TrueCar's bottom line.
A securities class action was filed against the company on
March 30, 2018 (Case No.
2:18-cv-02612-SVW-AGR). According to the class action complaint,
from approximately February 2017
until November 2017, TrueCar
misleadingly assured investors that USAA's ability to change the
co-branding website was merely a "risk," when, in fact, USAA had
already decided to implement such changes. As a result of the
company's allegedly false and misleading statements (and other
alleged wrongdoing, such as the failure to implement, maintain, or
follow adequate internal controls), TrueCar stock traded at
artificially-inflated levels. Once the truth was finally revealed
in a November 2017 earnings report,
the company's stock price fell precipitously, dropping more than
35%. The complaint alleges that TrueCar's was not only aware of the
USAA website redesign, but certain officers and directors exploited
their positions as corporate fiduciaries and sold their personal
stock holdings for tens of millions of dollars in insider
profits.
Judge Wilson, of the United
States District Court for the Central District of
California, upheld the class
action complaint in February 2019,
finding that plaintiff had met the heightened pleadings standards
on a motion to dismiss, and "adequately alleged a strong inference
of scienter by alleging that Defendants knew about USAA's website
redesign and its impact as of January
2017." In August 2019 the
company agreed to pay $28.3 million
to settle the securities class action. The Schubert Firm is
investigating potential derivative claims based on harm the company
has suffered as a result of potential breaches of fiduciary duty by
the company's officers and directors.
If you currently own stock in TrueCar, Inc. and wish to obtain
additional information about derivative claims and your legal
rights, please contact Kathryn
Schubert via email at kschubert@sjk.law or by telephone at
(415) 788-4220, or fill out the form on our website at
www.classactionlawyers.com/true.
About Schubert Jonckheer & Kolbe
Schubert Jonckheer & Kolbe has extensive experience in
prosecuting securities claims and has successfully represented
investors throughout the nation in shareholder lawsuits. Attorney
advertising. Prior results do not guarantee similar outcomes.
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SOURCE Schubert Jonckheer & Kolbe LLP