Case Summary

Equinix

NASDAQ: EQIX

Case Details

  • Chan v. Equinix, Inc. et al.
  • Class Period:May 3, 2019 - March 24, 2024
  • Date Filed:May 02, 2024
  • Jurisdiction:U.S. District Court, Northern District of California
  • Docket Number: 3:24-cv-02656
  • Lead Plaintiff Deadline: July 1, 2024
Days Left to
Seek Plaintiff
37

Overview

A class action lawsuit has been filed against Equinix, Inc. (“Equinix” or the “Company”) (NASDAQ: EQIX) and certain of the Company’s current and former senior executive officers alleging violations of the federal securities laws.  The Equinix lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired Equinix securities between May 3, 2019, and March 24, 2024, both dates inclusive (the “Class Period”).  Investors have until July 1, 2024, to seek appointment as lead plaintiff of the Equinix class action lawsuit.

Equinix describes itself as “the world’s digital infrastructure company.”  The Company operates as a real estate investment trust (“REIT”) for tax purposes, and it owns data centers in most parts of the world.  As of February 2016, Equinix owned 260 data centers around the world.  Other organizations lease space within these data centers to house their software.

As a REIT, one of Equinix’s key metrics is Adjusted Funds from Operation (“AFFO”).  AFFO was a key metric used to determine executive compensation at Equinix throughout the Class Period.  AFFO is a company’s funds from operations, minus costs such as maintenance capital expenditures (“CapEx”) and other spending to maintain the company’s existing revenue bases.  This action also focuses on recurring CapEx and Maintenance CapEx, which are costs used to maintain the Company’s facilities and to be able to continue operating in its current form, respectively, and non-recurring CapEx (also called “Growth CapEx”), which consists of investments in new facilities or other initiatives which are intended to generate new revenue.  In pertinent part, this action alleges that the Company artificially inflated its AFFO by misclassifying recurring CapEx and Maintenance CapEx expenditures as Growth CapEx.

The Equinix class action lawsuit alleges that throughout the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that: (1) Equinix manipulated its financials to reduce operational expenses and boost AFFO; (2) Equinix oversold power capacity and did not warn of the risks associated with this practice; (3); Equinix lacked adequate internal controls; and (4) as a result, Defendants’ public statements were materially false and/or misleading at all relevant times.

As alleged in the Equinix lawsuit, on March 20, 2024, before the market opened, Hindenburg Research released a report on Equinix entitled “Equinix Exposed: Major Accounting Manipulation, Core Business Decay and Selling an AI Pipe Dream As Insiders Cashed Out Hundreds of Millions.”  On this news, the price of Equinix stock fell by $19.70 a share, or 2.33%, on March 20, 2024, to close at $824.88.  The next day, it fell a further $13.24, or 1.6%, to close at $811.64.

On March 25, 2024, before the market opened, the Company filed with the U.S. Securities and Exchange Commission a current report on Form 8-K which stated that the Audit Committee of the Company’s Board of Directors commenced an independent investigation to review the matters referenced in a recent short seller report.  Shortly after the release of the report, the Company received a subpoena from the U.S. Attorney’s Office for the Northern District of California.  On this news, the price of Equinix stock fell by $8.45 per share, or 1.05%, to close at $792.52 on March 25, 2024.

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If you purchased or otherwise acquired Equinix securities between May 3, 2019, and March 24, 2024, both dates inclusive, and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at investors@dicellolevitt.com. 

The deadline to apply to the Court to serve as a lead plaintiff in the Equinix lawsuit is July 1, 2024.

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