Caterpillar is sued by a shareholder after federal raid

1 Attorneys

#1 Attorneys Network

1 Legal - 1 Lawyers - 1 Attorneys

Injury Lawyer - Criminal - Foreclosure - Divorce

 

By Jonathan Stempel

<span class="articleLocation”>Caterpillar Inc was sued on Friday for
allegedly deceiving shareholders about its business, one day
after federal law enforcers raided three of its buildings in
connection with a probe into the heavy machinery manufacturer’s
offshore tax practices.

In a complaint filed in Chicago federal court, Jacob Newman
accused Caterpillar of defrauding him and other shareholders in
regulatory filings by touting its commitment to good ethics,
while concealing how it “unlawfully used foreign subsidiaries”
to avoid paying billions of dollars of U.S. taxes.

Caterpillar did not immediately respond to requests for
comment after business hours.

Shares of Caterpillar fell 4.3 percent on Thursday, wiping
out more than $2.4 billion of the Peoria, Illinois-based
company’s market value.

The company said it believed the raid by officials from
agencies including the Internal Revenue Service’s criminal
investigation division, the Department of Commerce and the
Federal Deposit Insurance Corp was connected with an IRS probe
related to a Swiss parts unit, Caterpillar SARL.

Caterpillar has been fighting an IRS demand that it pay $2
billion in taxes and penalties for shifting profit to the Swiss
unit to lessen its U.S. tax bill.

Newman is seeking unspecified damages in his proposed
class-action lawsuit on behalf of Caterpillar investors from
Feb. 19, 2013 through March 1.

The lawsuit also names Caterpillar Chief Executive Jim
Umpleby, Chairman Douglas Oberhelman and Chief Financial Officer
Bradley Halverson as defendants. Oberhelman preceded Umpleby as
chief executive.

Companies often face U.S. lawsuits accusing them of
securities fraud shortly after unexpected negative news causes a
decline in their stock prices. It is unclear how many lawsuits
Caterpillar might face.

The case is Newman v. Caterpillar Inc et al, U.S. District
Court, Northern District of Illinois, No. 17-01713.



1 Attorneys
1 Attorneys

1 Legal

#1 Attorneys Search Engine

1 Legal is part of the 1 Search Project

Practice Areas - News - Federal - State - Contact Us


Facebooktwitterredditpinterestlinkedinmail

Facebooktwitterlinkedinrss

1 Attorneys

#1 Attorneys Network

1 Legal - 1 Lawyers - 1 Attorneys

Injury Lawyer - Criminal - Foreclosure - Divorce

 


Leave a Reply