Shares of electric vehicle Acer Aspire 4745g Battery supplier A123 Systems continued falling to new lows this morning as one New York law firm began seeking investors who might want to sue management and the board over alleged violations of securities law.
Monday the Waltham, Mass.-based firm with plants in Livonia and Romulus, announced it would replace faulty batteries shipped to five customers, including Fisker Automotive.
CEO David Vieau said company officials discovered the problem in certain prismatic cells late last week at its Livonia facility. The defect appeared to be caused by one of four automated welding machines, he said. The company will start shipping replacement battery packs to five customers later this week, he said. It estimated the replacement effort will cost about $55 million that it will take as a charge to its earnings over the next several quarters.
By 11:40 a.m. A123 shares had fallen 14% to $1.21, up slightly from a morning low of $1.17. Since Friday, the stock has lost 29% of its value.
Earlier this morning the New York law firm of Bronstein, Gewirtz & Grossman, which bills itself as a “corporate litigation boutique,” issued a press release saying it was “investigating potential claims” of shareholders concerning whether the company and certain of its officers and directors have violated federal securities laws.
A123 spokesman Dan Borgasano declined to comment on the law firm’s statement.
Earlier this month, Consumer Reports disclosed that a $108,000 Fisker Karma flashed an error message and locked in gear with just 180 miles on the odometer, while being driven at the magazine's Connecticut testing center. The cause of that shutdown was associated with A123’s defective batteries, said Vieau, who declined to identify other customers who received defective MOTOROLA Cell Phone battery packs.
Monday the Waltham, Mass.-based firm with plants in Livonia and Romulus, announced it would replace faulty batteries shipped to five customers, including Fisker Automotive.
CEO David Vieau said company officials discovered the problem in certain prismatic cells late last week at its Livonia facility. The defect appeared to be caused by one of four automated welding machines, he said. The company will start shipping replacement battery packs to five customers later this week, he said. It estimated the replacement effort will cost about $55 million that it will take as a charge to its earnings over the next several quarters.
By 11:40 a.m. A123 shares had fallen 14% to $1.21, up slightly from a morning low of $1.17. Since Friday, the stock has lost 29% of its value.
Earlier this morning the New York law firm of Bronstein, Gewirtz & Grossman, which bills itself as a “corporate litigation boutique,” issued a press release saying it was “investigating potential claims” of shareholders concerning whether the company and certain of its officers and directors have violated federal securities laws.
A123 spokesman Dan Borgasano declined to comment on the law firm’s statement.
Earlier this month, Consumer Reports disclosed that a $108,000 Fisker Karma flashed an error message and locked in gear with just 180 miles on the odometer, while being driven at the magazine's Connecticut testing center. The cause of that shutdown was associated with A123’s defective batteries, said Vieau, who declined to identify other customers who received defective MOTOROLA Cell Phone battery packs.
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