Nature’s Sunshine, manufacturer of herbal supplements, vitamins and complementary products, could be facing several class action lawsuits after allegations that the company violated federal securities laws by issuing false and misleading statements during the period from the first quarter of 2002 to the third quarter of 2005.
In a shock announcement on 20 March, Nature’s Sunshine said that it was withdrawing its financial statements for the period and warned that it could be delisted from the Nasdaq. An internal investigation, the company said, has revealed “certain internal control weaknesses” and outlined “potential violation of law”. The company also said that the internal investigation recommended “the termination of certain employees and senior officers.”
Following these disclosures, stock in Nature’s Sunshine plummeted, dropping over 35%.
As a result of these allegations, a number of investors who purchased Nature’s stock during the period from 13 May 2002 to 20 March 2006 are making moves to file a class action lawsuit against the company and its current and former management.
Responding to these potential lawsuits, Nature’s Sunshine said: “The company is aware of several potential class-action lawsuits, but has not been served. We have retained specialised legal counsel with significant experience in securities litigation to assist in our defence. Nature’s Sunshine Products is prepared to aggressively defend its position.”