When Audible last week announced both its fourth-quarter results and future plans, some investors were mad as hell over the cost of the company's expansion plans.
Now, apparently, they're not going to take it anymore.
A class-action suit has been brought against Audible Inc. and principals in the company on behalf of investors who have invested in Audible since last November. Audible is located in Wayne, N.J.
The suit, which is called Carter v. Audible and was filed Tuesday, alleges that Audible misled investors. It claims that "representations about the company's operations" were false and misleading, largely because the company's growth could not continue without substantial investments that would erode earnings.
The suit also alleges that Audible CEO Donald Katz and CFO Andrew Kaplan sold substantial Audible shares prior to this disclosure. In a statement, Audible said it thought the claims are "utterly without merit" and "baseless."
After learning of the cost of three ambitious programs last week—Audible UK, Audible Education and Audible Wireless—investors hammered the stock, sending it down more than 50%.
