A Minnesota federal judge recently denied defendants’ motion to dismiss a securities class action against CenturyLink and several of its senior executives. The court found that plaintiffs’ complaint sufficiently alleges that defendants knowingly or recklessly concealed CenturyLink’s years-long practice of “cramming” customer accounts by adding services without customers’ authorization, deceiving customers about the prices they would be charged, and misquoting prices by failing to disclose that service “bundles” included fees for optional services that the customers did not need or authorize. The court further held that the complaint sufficiently alleges that defendants made material false representations to investors, including that CenturyLink’s sales practices were aboveboard and represented that CenturyLink would never “plac[e] or record[] an order for our products and services for a customer without that customer’s authorization,” and that CenturyLink’s revenue growth in its consumer and small business segments was due to its focus on customer needs through its call centers, bundling service packages, and other strategies, when in fact the Company’s revenues were materially inflated by its deceptive and unlawful practices. Finally, the court held that the complaint sufficiently alleges that, when CenturyLink’s billing misconduct came to light, it resulted in sharp declines in the prices of CenturyLink’s securities, causing investors to incur substantial damages under the federal securities laws.
Stoll Berne, led by attorneys Keith Dubanevich, Tim DeJong, and Keil Mueller, previously was appointed co-lead counsel along with Bernstein Litowitz Berger & Grossmann LLP.
