… Robbins Geller Rudman & Dowd …

Robbins Geller Rudman & Dowd LLP announced that a class actionhttp://www.rgrdlaw.com/media/cases/250_Complaint.pdf has been commenced in the United States District Court for the Northern District of California on behalf of purchasers of Violin Memory, Inc. common stock pursuant and/or traceable to the registration statement and prospectus issued in connection with Violin Memory’s September 27, 2013 IPO.

The complaint charges Violin Memory, certain of its officers and directors and the underwriters of the IPO with violations of the Securities Act of 1933. Violin Memory develops and supplies memory-based storage systems to enhance storage performance with high-speed applications, servers, and networks in the Americas, Europe, and the AsiaPac.

The complaint alleges that Violin Memory conducted its IPO during the lead-up to the 2013 U.S. government shutdown, which was of significant importance to Violin Memory because the U.S. government is a large indirect customer of the company. According to the complaint, the registration statement and prospectus used by defendants to sell Violin Memory shares in the IPO (and thereafter) were negligently prepared and contained false and misleading statements and/or failed to disclose, among other things, that at the time of the IPO Violin Memory’s sales had already been adversely affected by the looming government shutdown. Moreover, the complaint alleges the company’s sales and R&D expenses had grown during the third quarter 2013, increasing its cash burn-rate to an unsustainably high rate based on the company’s cash on hand. Thus, the complaint alleges that Violin Memory’s sales growth and profit margins were declining, bringing its profits down at the time of the IPO.

The complaint alleges that due to these misstatements and omissions, the IPO was successful for the defendants and the company sold 18 million shares of Violin Memory common stock to the public at $9 per share, raising $162 million in gross proceeds for the company. However, the complaint alleges that Violin Memory stock currently trades around $3.30 per share, a 65% decline from the IPO price, and that analysts have slashed their ratings and price targets on the stock following disclosures, among other things, that “[a]s a result of unexpected reprioritization of budgets ahead of the federal government shutdown, some … forecasted [sales] were cancelled and others were deferred to future quarters pending funds being allocated to the project[s],” and that Violin Memory incurred increased sales and marketing costs during the third quarter of 2013.

Plaintiff seeks to recover damages on behalf of all purchasers of Violin Memory common stock pursuant and/or traceable to the registration statement and prospectus issued in connection with Violin Memory’s September 27, 2013 IPO. The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.