Olympus ADR holders file suit in US court
A US investor has filed a class-action suit against Olympus accusing the company of presenting false financial statements for at least five years to cover-up massive losses, the Japanese firm said Friday.
The case was filed with a Pennsylvania court by an individual on behalf of all holders of Olympus American Depositary Receipts purchased between November 7, 2006 and November 7, 2011, Olympus said in a statement issued in Tokyo.
ADRs allow a foreign company to trade on US stock exchanges.
In the US case, the plaintiff argues that the company presented incorrect financial results over at least five years in order to conceal losses.
Olympus on November 8 admitted to hiding losses on securities investments dating back to the 1990s and said that it used funds related to recently scrutinised acquisitions to help do so.
The value of its ADRs fell to $9.05 that day, from $13.72 the previous day, and slid further to $6 on November 10.
In the suit, the plaintiff demands an unspecified amount of compensation from the firm and the three chief executives in office during the five-year period, notwithstanding that one of them, Briton Michael Woodford, was fired on October 14 by the Olympus board for demanding explanations for these malpractices.
The other CEOs referred to are Tsuyoshi Kikukawa, in office immediately before and after Woodford, and current chief executive Shuichi Takayama appointed after Kikukawa's resignation.
Olympus believes, however, the case will have little significance as there is only a small proportion of its ADRs outstanding.
© 2011 AFP