Shareholders File Class-Action Lawsuit against Swisher Hygiene

Date: October 19, 2012

Source: News Room

Shareholders of Swisher Hygiene (Charlotte, NC) have filed a class-action lawsuit accusing the company of manipulating the stock price by filing misleading financial reports. According to the Charlotte Observer, a federal judge has now named lead plaintiffs in the case. The issue is further complicated by the company having funded many of its acquisitions using some portion of equity. The company bought more than 50 businesses last year alone. At issue is an announcement made last May in which the company said an audit revealed a potential $3.8 million increase to net losses incurred in 2011 because of how it accounted for its acquisitions and allowances for doubtful accounts. Last month the Nasdaq warned that the company was in danger of being delisted from the exchange.

The review has also roiled top leadership. CFO Michael Kipp left in March, followed by CEO Berrard in August. Brian Krass, who replaced Kipp as CEO, resigned in September. Thomas Byrne, an associate of Berrard and co-founder of their New River Capital private equity fund, has replaced him as interim CEO. Berrard remains the company's largest stockholder and a member of the board which he shares with co-founder H. Wayne Huizenga, its chairman, Senator David Braley and former governor Jeb Bush.

See also: "Swisher Hygiene Could Get Delisted, Nasdaq Warns," (www.wasteinfo.com/news/wbj20120926G.htm), September 26, 2012.

See also: "Swisher Hygiene CEO Steps Down amid Accounting Problems," (www.wasteinfo.com/news/wbj20120821H.htm), August 20, 2012.

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