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Kobe Steel hit with 3 class action lawsuits on data falsification allegations

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Kobe Steel hit with 3 class action lawsuits on data falsification allegations

Kobe Steel Ltd. is facing three separate lawsuits in the U.S. on the allegations of repeatedly falsifying data on aluminum, copper, iron and steel products, and knowingly selling products that failed quality control tests.

Rosen Law Firm, Bronstein, Gewirtz & Grossman LLC and Block & Leviton LLP filed class actions against the company and certain of its officers and directors on alleged violation of federal securities laws.

The legal actions were initiated on behalf of the purchasers of the company's securities during May 29, 2013, through Oct. 12, 2017, and seek to recover damages.

The complaints said the defendants made false and/or misleading statements and failed to disclose the quality of its products and integrity of its operations by emphasizing that it offers "excellent products and services" with "special attention to product safety" as it has "an organizational culture that is highly sensitive to compliance issues."

In October, Kobe issued several statements admitting that it had "improperly rewritten" the data inspection certificates for thousands of tons of its copper and aluminum shipped to its customers, which include Toyota Motor Corp. and Honda Motor Co., among others.

The company's stock plunged as a result, causing hundreds of millions in losses to investors, the law firms said in separate Dec. 27 releases.

Kobe Steel, in November, blamed data manipulation across its multiple production facilities to lack of quality controls and the relentless pursuit of profits in an internal company report.

The Japanese steelmaker also admitted that managers at production sites were involved in tampering with product specification data to avoid the costs associated with remaking the products to meet the requisite standards.