March 16, 2013
Law firm Robins Geller Rudman & Dowd LLP announced this week that it's suing Atlantic Power (NYSE: AT ) for alleged false and/or misleading statements concerning the utility's business and finances.
The official complaint (link opens in PDF) charges Atlantic Power with violations of the Securities Exchange Act of 1934 and alleges that the company knowingly supported its 10% payout with unsustainable cash flows even as many of its project contracts were set to expire in 2013.
According to a Robins Geller press release statement, "As the market learned the truth about Atlantic Power's mounting losses and its inability to maintain its outsized dividend through a number of misleading financial disclosures between Nov. 7, 2012, and March 4, 2013, more than $1 billion of the company's market capitalization disappeared."
The class action suit applies to all Atlantic Power stock purchases between July 23, 2010, and March 4 of this year. As of this writing, Atlantic Power hasn't publicly responded to the firm's allegations.