Robbins Arroyo LLP: Fusion Connect, Inc. (FSNN) Misled Shareholders According to a Recently Filed Lawsuit

Shareholder rights law firm Robbins Arroyo LLP announces that a purchaser of Fusion Connect, Inc. (NASDAQ: FSNN) filed a class action complaint for alleged violations of the Securities Exchange Act of 1934 between August 14, 2018 and April 2, 2019. Fusion Connect offers domestic and international voice services to telecommunications carriers worldwide.

View this information on the law firm's Shareholder Rights Blog: https://www.robbinsarroyo.com/fusion-connect-inc/

Fusion Connect Overstated Earnings

According to the complaint, in May 2018, Fusion Connect acquired the cloud and business services business of Birch Communications Holdings, Inc. For accounting purpose, the merger was treated as a “reverse acquisition” under generally accepted accounting principles and Birch was treated as the accounting acquirer. Accordingly, Birch’s historical results of operations replaced Fusion’s for all periods prior to the merger. However, Fusion Connect later revealed the process used by certain of its Birch subsidiaries for capitalizing costs associated with the customer on-boarding process and the related judgments and estimates were not designed with sufficient precision, leading to an overstatement of its earnings of between $1.7 million and $4.1 million. The truth was revealed in April 2019 when Fusion Connect revealed that its previous financial statements should not be relied upon and that it was unable to file its 2018 Form 10K on time due to the accounting errors. On this news, Fusion Connect shares dropped over 80% to close at $0.22 per share on April 3, 2019.

Fusion Connect Shareholders Have Legal Options

Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Leo Kandinov at (800) 350-6003, lkandinov@robbinsarroyo.com or via the shareholder information form on the firm's website.

Robbins Arroyo LLP is a nationally recognized leader in shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested.

Attorney Advertising. Past results do not guarantee a similar outcome.

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