A Micron Technology Inc. shareholder has accused the company CEO and several board members of insider trading after selling $70 million worth of stock just before the release of disappointing financial results regarding demand for its semiconductors.
Investor brought a shareholder derivative lawsuit against the company, CEO Sanjay Mehrotra and several board members in Florida federal court, saying they misappropriated “material non-public information” to keep shares overinflated so Mehrotra could sell nearly 700,000 shares under “highly suspicious circumstances” before prices dipped following the release of a December earnings report.
The nine-count complaint includes allegations of violating the Securities Exchange Act, breaching fiduciary duties and unjust enrichment.
Micron noted in regulatory filings that the semiconductor industry declined at the end of 2022 and throughout 2023 due to weak market demand “combined with global and macroeconomic challenges.”
The defendants, however, repeatedly told investors that demand for Micron’s products was recovering due to applications in artificial intelligence and that the company was “on track for record revenues” in fiscal year 2025, according to the complaint.
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