There is more bad news in what is proving to be a tough year for Polaris. Last week corporate litigation firm Bronstein, Gewirtz, and Grossman LLC announced an investigation into the company had been launched based on claims of investors regarding possible violations of the Securities Exchange Act. Multiple firms have now announced a related class action lawsuit has been filed against the Power Sports company.
According to the suit, Polaris made false or misleading statements and/or didn’t disclose necessary information regarding recall issues of certain RZR vehicles. The company has declared multiple recalls due to fire hazards this year, however, the suit claims they failed to accurately disclose how complex and expensive the repairs could cost or how much it would impact the company’s bottom line. The suit goes on to claim that as a result, Polaris’s public statements have been inaccurate and causing shareholders to potentially suffer unnecessary loses.
The issue at the heart of the matter is a recall the company issued for 2016 RZR Turbo models that may potentially pose a fire threat. Unfortunately, this is one of 5 recalls the company has released in 2016 and 6 in the last year. The issued gained national attention earlier this year when a 15 year old girl was fatally injured when the ATV she was riding in wrecked and caught fire.