A lawsuit filed Tuesday by an iRobot Corporation stockholder claims that the company and its board are pursuing a deal with Amazon without the requisite disclosures, disabling shareholders from making an informed vote about whether they approve the $1.7 billion transaction.
The suit explains that in early August the two companies announced Amazon’s intent to buy iRobot, an innovative home cleaning products company that makes and sells Roomba floor vacuuming robots and the Braava family of automatic floor mopping robots. The complaint explains that the company, founded in 1990, operates in international markets from its headquarters in Bedford, Mass.
The announcement reprinted in the complaint expressed Amazon’s excitement about iRobot’s much-loved products and that the buyer was impressed by iRobot’s commitment to innovation. Amazon is set to pay $61 per share in the all-cash transaction, which is scheduled to close on October 17, subject to customary closing conditions.
The complaint takes issue with the accompanying proxy statement filed with the Securities and Exchange Commission (SEC) by iRobot and its board of directors. The filing recommends that shareholders vote for the transaction, but according to the complaint, leaves out critical pieces of financial and conflict-related information.
“Absent disclosure of the foregoing material information prior to the stockholder vote, Plaintiff and the other stockholders of iRobot will be unable to make a sufficiently informed decision in connection with the Proposed Transaction and are thus threatened with irreparable harm warranting the injunctive relief sought herein,” the suit argues.
The complaint states two claims for relief against the company and against the board for violating the securities law’s disclosure requirement. It asks for the court to halt the transaction until the corrective disclosures are made or for rescissory damages in the event that it goes ahead.
The plaintiff is represented by Acocelli Law PLLC.
