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NEW YORK, Jan. 22, 2016 -- Pomerantz LLP announces that a class action lawsuit has been filed against Ooma, Inc. (“Ooma” or the “Company”) (NYSE:OOMA) and certain of its officers. The class action, filed in Superior Court of the State of California, County of San Mateo, is on behalf of a class consisting of all persons or entities who purchased Ooma securities in or traceable to the Company’s July 17, 2015 initial public stock offering (the “IPO”). This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1933 (the “1933 Act”).
A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll free, ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.
Ooma provides communications solutions and other connected services to small business, and home and mobile users in the United States and Canadian markets. The Company offers the Ooma Office Mobile HD app that allows users to remotely access their business communications system to make, receive, and transfer phone calls; Ooma Telo, a home communications solution designed to serve as the primary phone line in the home; and the Ooma Mobile HD app, which allows Ooma Telo users to make and receive phone calls and access Ooma features and settings with iOS or Android device over a Wi-Fi or cellular data connection.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: at the time of Ooma's IPO, the Company’s Registration Statement concealed that: (i) certain outsized prior fiscal year sales to its largest outside reseller — who was emphasized in the Company’s Offering Documents to be a very important Ooma partner — were not recurring or being replaced in the fiscal year leading into the IPO; (ii) the Company's customer churn rate — emphasized repeatedly throughout the Offering Documents as being at an industry low rate of 0.55% — had increased significantly as of the IPO as a result of customers having endured eight-hour service outages in April and May 2015; (iii) technological difficulties in the Company's lead generation business were causing leads to get lost in the Internet before reaching their intended targets, thus negatively impacting sales of that service and the Company's business; (iv) Ooma's subscription revenue growth and operating and pretax profit margins were both falling; and (v) all of these problems had caused the Company's subscription retention rate to plummet and net losses to double on a year-over-year basis, as of the IPO.
On July 17, 2015, utilizing false and misleading Offering Documents, Ooma successfully raised $65 million in its IPO, having priced its stock at $13 per share. Ooma's stock has been trading at approximately half the IPO price and as of the filing of this Complaint traded at approximately $6 per share, leading to tens of millions of dollars in losses for investors.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
CONTACT: Robert S. Willoughby Pomerantz LLP [email protected]
