March 23, 2011
Shareholders have filed a federal class-action lawsuit against the Danish wind energy giant Vestas Wind Systems, which employs about 1,500 people in Colorado, alleging that the company inflated its stock price with misleading information.
The suit was filed last week by the employee pension fund of the City of Sterling Heights, Mich., in U.S. District Court in Denver, naming Vestas and many of its executives in Denmark and the U.S.
Vestas denied the claims.
“The company has reviewed the complaint with its legal and other advisors and believes that the complaint is without merit,” Vestas said in a statement released Monday. “The company and the individual defendants intend to defend themselves vigorously.”
Vestas’ stock hit a high of $78.05 a share on Nov. 9, 2009, but in August 2010, the company revised its financial outlook downward and the stock dropped sharply. The lawsuit alleges that the company “artificially inflated” the stock by announcements of revenue and earnings expected to be recognized in 2010 that ended up being deferred and by delaying compliance with a new accounting standard.
Vestas said wind installations fell due to the recession, but that orders picked up in the second half of 2010.
Vestas has invested more than $1 billion in Colorado for manufacturing plants in Pueblo, Brighton and Windsor and a research center in Lousville. Its U.S. headquarters is in Portland, Ore.
The company has cut jobs in Europe in recent years, while expanding its workforce and operations in U.S. and China, which, it says, are seeing more rapid growth in wind energy.