Judge consolidates class-action suits against pasta maker

From the Kansas City Star:

A federal judge has consolidated numerous class-action lawsuits against American Italian Pasta Co. and appointed three locals of the Iron Workers union as lead plaintiff in the case.

U.S. District Judge Ortrie Smith today ruled that the cases shared factual and legal issues, “and consolidation will streamline matters and prevent needless confusion, expense and delay.”

The cases were filed after the Kansas City-based company on Aug. 9 announced a $60.7 million charge and disclosed that it would delay filing its quarterly financial report and that the Securities and Exchange Commission had launched an investigation..

The next day American Italian’s stock price closed $7.15 lower, a 33.5 percent drop. In midday trading on the New York Stock Exchange, American Italian shares were up 46 cents, or 6.05 percent, at $9.06.

At least half a dozen securities and derivative actions — lawsuits brought by shareholders on behalf of the corporation over allegedly improper management — have been filed against American Italian since then. Plaintiffs include several firefighter and police pension funds, including the Firefighters’ Pension System of the City of Kansas City, the union security funds of Iron Workers Local No. 40, 361 and 417 and the Teachers’ Retirement System of Louisiana.

After finding that that the Iron Workers unions had the biggest financial stake in the litigation, Smith selected them as lead plaintiff.and their attorneys in the case, New York-based Pomerantz Haudek Block Grossman & Gross, as lead counsel.