PLDT Inc. said on Monday that two of its investors filed separate motions to the court on April 7 seeking to serve as the lead plaintiff for the US class action lawsuit against the telecommunications company.
One of the investors, Sophia Olsson, who claims to have two shares in the telco, was said to have reported an alleged loss of $22.69 after the listed disclosed its budget overrun.
Meanwhile, Kevin Douglas, a PLDT investor holding 35 shares in the company, reported an alleged loss amounting to $240.23.
In a disclosure to the Philippine Stock Exchange, PLDT said that Milbank LLP, on behalf of the telco giant, has entered its appearance in the US class action. It also filed a notice of interested persons or entities along with a corporate disclosure statement as well as a memorandum of points and authorities for consideration by the court on April 17.
The two plaintiffs, represented by different law firms — Ms. Olsson by the Rosen Law Firm and Mr. Douglas by Levi & Korsinsky, LLP — are said to have failed to establish that they are appropriate lead plaintiffs.
“Under the Private Securities Litigation Reform Act, lawsuits by shareholders with a small position in the security at issue are discouraged,” PLDT said.
“Consequently, the company argued that the de minimis purported losses alleged by the Movants in this case fall far short of the basic requirement that a lead plaintiff make prima facie showing that he or she is an adequate representative who will prosecute the action vigorously on behalf of the putative class,” it added.
The company said that the two investors’ nominal losses lack sufficient financial interest in the outcome of the US class action.
“Thus, the company argued in its Memorandum that the Movants’ motions for appointment as lead plaintiff should be denied,” PLDT said.
The company is set to have a hearing for the appointment of the lead plaintiff on May 8.
“The company shall provide further updates in compliance with Philippine and US laws on disclosures related to pending litigation as they arise,” it said.
In a disclosure on Feb. 14, the company said that it had learned of a securities class action lawsuit filed on Feb. 6 by Ms. Olsson in the district court in the Central District of California.
The lawsuit named PLDT and nine of its current and former employees as defendants for allegedly violating Federal Securities Laws and a jury trial was demanded.
The individual defendants in the case include PLDT Chairman Manuel V. Pangilinan; President and Chief Executive Officer Alfredo S. Panlilio; Chief Legal Counsel, Head of Legal and Regulatory Affairs, and Corporate Secretary Marilyn A. Victorio-Aquino; and Anabelle L. Chua, who was the chief financial officer and chief risk management officer during the filing.
The case came about after the Pangilinan-led PLDT disclosed a budget overrun amounting to P48 billion.
After the company disclosed the budget overrun, it saw a 19.35% decline in the price of its shares to P1,192 apiece on Dec. 19, 2022.
On Monday, PLDT shares closed lower by P35 or 2.76% to P1,234 apiece.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Justine Irish D. Tabile
