March 02, 2021 - An investor in shares of Renewable Energy Group, Inc. (NASDAQ: REGI) filed a lawsuit in the U.S. District Court for the Southern District of New York over alleged violations of Federal Securities Laws by Renewable Energy Group, Inc. in connection with certain allegedly false and misleading statements made between May 3, 2018 and February 25, 2021.
Ames, IA based Renewable Energy Group, Inc. provides lower carbon transportation fuels in the United States and internationally. Renewable Energy Group, Inc. reported that its annual Total Revenue rose from $2.38 billion in 2018 to $2.64 billion in 2019, and that its Net Income increased from $292.31 million in 2018 to $380.06 million in 2019.
On February 25, 2021, after the market closed, Renewable Energy Group, Inc. announced its fourth quarter and full year 2020 financial results. Therein, the Company revealed that it would restate $38.2 million in cumulative revenue from January 2018 through September 30, 2020 because Renewable Energy was not the proper claimant for certain BTC [biodiesel mixture excise tax credits] payments on biodiesel it sold between January 1, 2017 and September 30, 2020. Renewable Energy further stated that it had reached an agreement with the Internal Revenue Service on a $40.5 million assessment, excluding interest to correct these claims.
Shares of Renewable Energy Group, Inc. (NASDAQ: REGI) declined from $117.00 per share on February 10, 2021, to $76.40 per share on February 26, 2021.
According to the complaint the plaintiff alleges on behalf of purchasers of Renewable Energy Group, Inc. (NASDAQ: REGI) common shares between May 3, 2018 and February 25, 2021, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between May 3, 2018 and February 25, 2021, the Defendants failed to disclose to investors that due to failures in the diesel additive system, petroleum diesel was not periodically added to certain loads by the Company and was instead added by the Company’s customers, that, as a result, Renewable Energy was not the proper claimant for certain BTC payments on biodiesel it sold between January 1, 2017 and September 30, 2020, that, as a result, Renewable Energy’s revenue and net income were overstated for certain periods, that there was a material weakness in the Company’s internal control over financial reporting related to the purchase and use of the petroleum diesel gallons when blending with biodiesel, and 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.