CTST stock has not had the best couple of months. In August, a class-action suit hit CannTrust Holdings (TSX:TRST) (NYSE:CTST), and a month later, the company eliminated 20% of its workforce, causing the cannabis stock to drop around 4%. Today, news of another CTST lawsuit has surfaced, once again sending the stock into the red.
Here’s what we know.
CTST Stock Tumbles Again
On Monday, September 9, Bronstein, Gewirtz & Grossman, LLC told investors that a class action lawsuit has been filed against the Ontario company. The suit was filed on behalf of shareholders who purchased CTST securities between November of last year through July 2019. The suit is meant to recover damages against defendants for allegedly violating federal securities laws under the 1934 Securities Exchange Act.
According to the New York firm, defendants failed to disclose that CannTrust was growing cannabis in its Pelham greenhouse when regulatory approval applications had not yet been processed. This, of course, is not the first class-action suit looking into CannTrust Holdings operating its Pelham facility when it was not supposed to. The August class-action suit announced by Brodsky & Smith, LLC looked into the same matter. And just as CTST stock fell on that news, the cannabis stock is floating in the red Monday as well.
According to Yahoo Finance, as of 12:13 PM EDT, CTST stock is trading at $1.72 on the New York Stock Exchange, putting it down 3.37%. It is still early in the trading day, however, so it will be interesting to see where CannTrust stock closes after the bell rings Monday.
Do you have any thoughts on CTST stock falling on the market because of all these class-action lawsuits? Are the suits to blame, or do you think today’s drop has to do with the company reducing its workforce? Let us know your thoughts in the comments below.
Featured image: PixaBay