ELNK.US
id: 1216
EarthLink (ELNK) $85M Investor Settlement
Eligible claimants can submit their claims for compensation.
E. D. Arkansas
Court4:18-cv-00202
Case number11/07/2016
Class period Start03/19/2018
Class period EndEarthLink reached an agreement with $ELNK investors to settle claims related to the misleading about the merger in the Proxy Statement.
Outline
After EarthLink and Windstream merged in 2017, Windstream faced financial trouble, missing targets and receiving negative ratings. By early 2018, it reported a huge loss and its stock plummeted. By February 25, 2019, Windstream filed for bankruptcy. Following this news, EarthLink faced a lawsuit from investors.
Timeline
- On February 27, 2017: EarthLink and Windstream completed their merger.
- In February 2018: Windstream reported a huge net loss of $1.84B for Q4.
- In July 2018: Windstream’s stock had plummeted 90.5%.
- On February 25, 2019: Windstream filed for Chapter 11 bankruptcy.
- On May 27, 2021: $ELNK stockholder filed a claim against EarthLink over undisclosed issues related to the merger.
Background
On February 27, 2017, EarthLink and Windstream completed their merger. The deal, valued at $1.1 billion, gave Windstream stockholders 51% and EarthLink stockholders 49% of the combined company.
In early 2017, Windstream faced a series of financial setbacks, starting with weak earnings on March 1, missing revenue estimates by $30 million. After that, Moody's downgraded the company’s debt rating to "negative" due to persistent performance issues.
By May 4, Windstream reported disappointing Q2 results across all segments, while CFO Bob Gunderman highlighted competitive pressures and challenges during a conference.
Then, in October 2017, Seeking Alpha raised concerns about Windstream's poor performance and bankruptcy risks. Deutsche Bank also noted worsening revenue, and Moody's warned that a recent default notice could hurt the company's ability to refinance debt.
After that, in February 2018, the company reported a huge net loss of $1.84 billion for Q4.
By July 26, 2018, Windstream’s stock had plummeted 90.5% from its price at the merger’s closing.
On February 25, 2019, Windstream and its subsidiaries, including EarthLink, filed for Chapter 11 bankruptcy.
What Can Investors Expect Now?
EarthLink reached an agreement with $ELNK investors to settle claims related to the misleading about the merger in the Proxy Statement.
If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section below.
Case Status
Accepting Claims
Alleged Offence
Mismanagement,
Misleading Statements,
Omissions
Suspected Party
Directors,
Management
Security Type
Stocks
Trade Direction
Long
Payout per Share
0.92
Filing date
03/19/2018
Plaintiffs
Robert Murray
Attorneys
Carney Bates & Pulliam, PLLC (Little Rock, AR), Johnson Fistel, LLP (San Diego, CA), Robbins Geller Rudman & Dowd LLP (San Diego, CA)
Defendants
Joseph F Eazor, Kathy S Lane, Garry K McGuire, R Gerard Salemme, Julie A Shimer, Marc F Stoll, Walter L Turek
Judge
Hon. Billy Roy Wilson
Administrator
Gilardi & Co LLC
Court hearing date
02/06/2025
Exclusion deadline
01/16/2025
Objection deadline
01/16/2025
Attorney fee
$28,149,999
Trades matching type
FIFO
+$85,000,000
Cash Settlement AmountFrequently Asked Questions
When will you be able to apply for the payment?
Do I have to sell securities to be eligible?
How long does the payout process take?
What is 11thestate?