The chief financial officer of Taiwan-based microchip maker Himax Technologies was named as the sole defendant in a class action securities lawsuit alleging that he violated securities laws, breached his fiduciary duties, and made false or misleading statements in connection with the company’s public offering.
The suit, filed Monday against CFO Max Chan in U.S. District Court for the Central District California, is being brought on behalf of investors that purchased securities in connection with the company’s 2006 initial public offering. The complaint contends that Chan violated the Securities Act of 1934 by breaching his fiduciary duties, according to the plaintiffs, who are represented by the law firm of Shepherd, Finkelman, Miller & Shah.
Chan allegedly misled investors when he misstated customer demand for the company’s microchips based on unusually high inventory levels at Himax client companies, according to the complaint. Himax microchips are used in flat panel display screens, found commonly in wireless phones, televisions, portable DVD players and car navigation systems. A mid-cap company, Himax generates $805 million annually.
On March 30, 2006, Himax offered 52 million American depositary shares at the price of $7.50 to $9 per share. Morgan Stanley was the lead underwriter of the offering. At the time of the offering the company said it would use the IPO proceeds to purchase new equipment and software, and pay for construction costs of its new headquarters in Taiwan.
Shepherd, Finkelman, Miller & Shah could not be reached to disclose why Chan was the only named defendant in the case. Himax released a statement Monday saying it would “vigorously” defend Chan.