NEW YORK, June 17, 2024 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, is investigating potential claims against Lumen Technologies, Inc. (NYSE: LUMN) on behalf of long-term stockholders following a class action complaint that was filed against Lumen on March 3, 2023 with a Class Period from September 14, 2020 to February 7, 2023. Our investigation concerns whether the board of directors of Lumen have breached their fiduciary duties to the company.
At the outset of the Class Period, Lumen announced it would redefine its business by renaming itself from CenturyLink to Lumen and refining its marketing approach, cutting off market segments and operations that did not align with the Company’s strategic objectives and adding market segments that were aligned with the Company’s vision.
Specifically, Lumen announced to investors that it would leverage its existing 400,000 route miles of fiber optic cable, which had previously serviced enterprise and wholesale markets, to expand its fiber services to small and medium business (“SMB”) and residential or consumer markets. Lumen represented to investors that expanding its fiber services into the SMB and residential markets, branded as Quantum Fiber, was a natural fit for the Company that represented a strong opportunity for growth.
Throughout the Class Period, Defendants represented to investors and the public that Lumen was, among other things, “investing heavily in our consumer fiber business” and “aggressively taking market share in our small business segment.” Defendants also represented that “we continue expanding our Quantum Fiber footprint and increasing our penetration” and “we're not capital-constrained. So as we continue to improve our penetration and performance, we'll continue to expand our footprint, and we believe we've got a long runway for growth in -- within Lumen in Quantum Fiber.”
However, contrary to Defendants’ statements touting the rate of investment and progress in expanding fiber services to SMB and residential markets, Lumen was experiencing serious headwinds that were impeding its ability to grow its newly-targeted fiber markets.
Beginning on February 9, 2022, Defendants began to admit that Lumen’s expansion into SMB and residential fiber services was occurring slower than previously represented. On this news, Lumen’s stock price declined $1.99, from a close of $12.82 per share on February 9, 2022, to a close of $10.83 on February 10, 2022.
On November 2, 2022, Defendants continued to partially disclose the truth when Lumen’s Chief Executive Officer admitted, “let me be clear, we are not yet at the pace of build we expect or want” with respect to the Company’s development of its Quantum Fiber brand. On this news, Lumen’s stock price declined $1.25, from a close of $7.05 per share on November 2, 2022, to a close of $5.80 on November 3, 2022.
By February 7, 2023, Defendants would admit, contrary to what was previously represented, that they had pressed “more of a stop button than a pause button” on Lumen’s investment into the Quantum Fiber network and expansion into the SMB and residential markets while the Company re-evaluated its strategic priorities. The price of Lumen’s common stock had been artificially inflated by Defendants’ misrepresentations about the Company’s progress expanding into SMB and residential markets. Upon the news that Lumen’s progress was slower than represented and that Lumen had stopped investing in the expansion of its Quantum Fiber network, the price of Lumen’s common stock plummeted as the artificial inflation was removed from the price. On this news, Lumen’s stock price declined $1.04, from a close of $4.99 per share on February 7, 2023, to a close of $3.95 on February 8, 2023.
If you are a long-term stockholder of Lumen, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Marion Passmore by email at investigations@bespc.com, by telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.
About Bragar Eagel & Squire, P.C.:
Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.
Contact Information:
Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Marion Passmore, Esq.
(212) 355-4648
investigations@bespc.com
www.bespc.com
