April 3, 2019
A law firm specializing in filing litigation against publicly-held corporations, is seeking plaintiffs for a possible class action suit against AT&T regarding its standalone online TV streaming service, DirecTV Now.
The Law Offices of Howard G. Smith, in an April 2 press release, said AT&T in June 2018 issued nearly 1.2 million new shares of common stock following its $85 billion acquisition of Time Warner – which led to the formation of WarnerMedia.
At issue is AT&T’s registration statement accompanying the stock issuance that claimed DirecTV Now subscriber growth would offset ongoing subscriber declines at legacy pay-TV services DirecTV satellite service and AT&T U-verse.
Instead, after AT&T raised DirecTV Now’s monthly pricing from the promotional $39.99 fee to $49.99, subscriber growth reversed to sub losses – more than 250,000 DirecTV Now subs jettisoned in the most-recent fiscal period.
“On this news, shares of AT&T fell as low as $27.36 per share, a decline of nearly 16% from the $32.52 price per share on the exchange date for the acquisition, thereby injuring investors,” Howard G. Smith wrote in the release.
In a media statement, AT&T denounced the action.
“This is a carbon copy of a baseless suit filed in February,” said the telecom. “In both cases, the claims are wholly without merit.”