NEW YORK-Cellnet Data Systems Inc. reported a shareholder has sued the company, alleging it misled investors in connection with its initial public offering last month.
The Sept. 26 prospectus for the IPO of 5 million shares of common stock failed to disclose, as required, that a patent conflict with Itron Inc. is likely to ensue, according to the complaint.
Cellnet said the allegations are without merit and it intends to defend itself.
The lawsuit, which claims to be a class action, was filed Oct. 31 in California Superior Court of San Mateo County under the caption, Settle vs. Seidl et al. It names the company, some of its officers and Morgan Stanley & Co., New York, lead underwriter for the stock sale. The lawsuit seeks unspecified damages under provisions of federal and state securities laws.
In its short life on Nasdaq, Cellnet’s stock hit a high of $21.38 and a low of $11.50. It closed Nov. 5 at $14.63, up 25 cents from its closing price of $14.38 Nov. 4, the first trading day after the company publicized the lawsuit.
Cellnet Data Systems, headquartered in San Carlos, Calif., provides wireless monitoring networks to utilities.
