The action arises out of Redwire’s allegedly false and misleading financial statements leading up to its merger with Genesis Park Acquisition Corp. (GPAC) in early Sept. 2021.
Specifically, Defendants misrepresented and failed to disclose: (1) that there were accounting issues at one of Redwire’s subunits; (2) that, as a result, there were additional material weaknesses in Redwire’s internal control over financial reporting; and (3) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
The truth began to emerge on Nov. 10, 2021, when the company announced it would not report its Q3 2021 financial results as expected that day. Redwire explained that an employee raised concerns about potential accounting issues with a business unit 5 days before and that its audit committee was investigating the employee’s claims.
Then, on Nov. 15, 2021, before the market opened, Redwire announced that due to the pending investigation, “the Company has not been able to finalize its financial statements [for the period ended Sep. 30, 2021] or its assessment of the effectiveness of its disclosure controls and procedures and any impact” on the report.
These disclosures drove the price of Redwire shares sharply lower.
CASE TIMELINE
Hagens Berman is pleased to announce a settlement with defendants totaling $8 million. The settlement provides significant relief to purchasers of the securities of Redwire Corporation from Mar. 25, 2021 through Mar. 31, 2022, both dates inclusive. We have filed a motion for preliminary approval of the settlement and are awaiting the judge’s ruling.
On April 4, 2022, U.S. Magistrate Judge Patricia D. Barksdale appointed Hagens Berman as Lead Counsel in the case against Redwire concerning the Company's merger with Genesis Park Acquisition Corp. in early September 2021.
