The City of Boca Raton (Fla.) Police Officers and Firefighters Retirement System and the Plumbers Local 267 Pension Fund, Syracuse, N.Y., were named lead plaintiffs in a class-action securities lawsuit against XM Satellite Radio Holdings Inc., Washington, according to documents from the U.S. District Court for the District of Columbia.
The $160 million Boca Raton fund and the $75 million union fund are suing to recover a combined $552,000 in stock and stock options lost between July 28, 2005, and May 24. XM disclosed on Feb. 16 that it had would not meet its earnings target, according to court documents, and the stock subsequently dropped nearly 28.5%.
The suit alleges that XM executives did not disclose marketing expenditures to stockholders and were selling their own XM holdings when they knew the stock would drop because the company would not be able to reach its earnings target.
Crystal Duxbury, pension administrator for the Boca Raton fund, was not available for comment at press time. Michael Nanno, fund manager for the union fund, declined to comment.