SAN FRANCISCO, Feb. 26, 2025 (GLOBE NEWSWIRE) -- FTAI Aviation Ltd. (NASDAQ: FTAI) saw its shares jump on Feb. 20, after the aerospace firm dismissed allegations made by activist short-sellers Muddy Waters and Snowcap Research as “without merit.” While the company’s Audit Committee concluded that the claims lacked foundation, FTAI failed to provide specific rebuttals to detailed claims raised by Muddy Waters and a second short seller, Snowcap.
FTAI’s broad dismissal of the short-seller reports, without providing details from its internal review, leaves open questions about the thoroughness and transparency of the process. Hagens Berman urges FTAI Aviation investors to submit your losses now.
Class Period: July 23, 2024 – Jan. 15, 2025
Lead Plaintiff Deadline: Mar. 18, 2025
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FTAI Review Says Short Seller Claims Meritless, But Fails to Provide Detail
FTAI’s Audit Committee, after a review conducted by independent legal and forensic accounting advisors, concluded the short-seller claims lacked foundation, the company said.
FTAI now says it expects to file its Form 10-K on time. “After a thorough and comprehensive review…we have determined that the assertions…are unsupported and have no merit,” stated Paul R. Goodwin, Audit Committee Chair.
Despite this assertion, FTAI’s statement notably refrained from addressing the granular details of Muddy Waters’ and Snowcap Research’s allegations.
The Muddy Waters and Snowcap Reports
The initial Muddy Waters report, released January 15th, triggered a 24% plunge in FTAI's stock price and prompted the internal review.
Muddy Waters, based on an investigation that included a former FTAI executive and other industry insiders, alleged that FTAI has been improperly classifying one-time engine sales as Maintenance, Repair & Overhaul (MRO) revenue within its Aerospace Products segment. The firm contends this practice inflates Aerospace Products revenue, creating a misleading growth narrative that has benefited insider selling. Muddy Waters estimates the majority of FTAI’s adjusted EBITDA in the segment derives from less recurring gains on sales and alleges the company engaged in channel stuffing to inflate 2023 results.
On Jan. 21, 2025, FTAI announced that its Audit Committee had commenced a review into the Muddy Waters allegations and that its Annual Report may be delayed. This news caused a 23% decline in the price of FTAI Aviation stock.
Snowcap Research subsequently amplified these concerns on January 29th, claiming its own three-month investigation corroborated many of Muddy Waters’ conclusions. Snowcap described FTAI’s Aerospace segment as “in substance an elaborate fabrication” and stated it spoke with former FTAI executives, industry experts, and competitors who expressed confusion regarding the company’s accounting and disclosures.
The FTAI Investor Class Action
The company's handling of the allegations comes as it faces an investor class-action lawsuit in the Southern District of New York, alleging securities fraud. The suit, echoing Muddy Waters’ claims, seeks to recoup losses for investors who purchased FTAI securities between July 23, 2024, and January 15, 2025.
Shareholder rights firm Hagens Berman is currently investigating investors’ claims.
If you invested in FTAI and have substantial losses, or have knowledge that may assist the firm’s investigation, submit your losses now »
If you’d like more information and answers to frequently asked questions about the FTAI case and our investigation, read more»
Whistleblowers: Persons with non-public information regarding FTAI should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email FTAI@hbsslaw.com.
About Hagens Berman
Hagens Berman is a global plaintiffs’ rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman’s team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.
Contact:
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