Investors have had enough of Ecotality, Inc., and are taking legal action. The Rosen Law Firm, PA, has filed a lawsuit on behalf of Ecotality stockholders in New York and the Law Offices of Howard G. Smith, based in Bensalem, PA, is investigating potential claims on behalf of purchasers of Ecotality's securities. Both law firms are basing their claims on potential violations of federal securities laws between April 16, 2013 and August 9, 2013.
The legal claims assert that the electric vehicle charging equipment maker has been deficient in a number of areas, including failing to meet loan obligations for the US Department of Energy's EV Project and its commitment to deliver new Minit Chargers to customers in the second half of this year. Ecotality is also allegedly liable for $855,000 in back wage and damage payments to the Department of Labor and some of its charging systems had been causing overheating and melting connector plugs while charging. Lastly, Ecotality's financial statements were allegedly false and misleading.
On August 12, Ecotality fessed up to some of its problems in a Securities and Exchange Commission 8-K filing. The company is being squeezed into exploring options that include restructuring for sale or bankruptcy. The Rosen Law Firm and the Law Offices of Howard G. Smith are both looking into filing class action lawsuits for investors against Ecotality.