(CN) - Stratasys investors cannot show the company intentionally misled investors about its essentially inoperable MakerBot 3-D printer line, a product failure that cost the company 75 percent of its value, the 8th Circuit ruled.
In 2015, shares of Stratasys, a maker of 3-D printers, fell from $80.08 to $57.36 per share on the first newsof problems with its MakerBot line of desktop 3D printers.
Consumers experienced significant clogging issues with the MakerBot's replacement print head, which was designed to be swappable. Many buyers returned the printers, and sales declined.
Shares hit a low in mid-2016 of $15.61 per share, and traded Thursday at $25.15.
Shareholders sued the company, claiming that it misled investors by touting the MakerBot as "unmatched" in quality and performance, while allegedly knowing that the printers were essentially inoperable.
A federal judge ruled against the investors, however, and the 8th Circuit affirmed that Stratasys's vague claims that its printers offer "unmatched speed" is not a statement that a reasonable investor would rely on.
Further, there is no evidence showing Stratasys' executives intentionally lied about the company's product.
"The shareholders' claims fail because their allegations do not adequately tie Stratasys's knowledge of the product quality issues or their financial repercussions to the timing of the statements," Judge William Duane Benton said. "The shareholders' allegations about Stratasys's knowledge of the 5G printers' issues, from confidential witness accounts, do not provide particular details about when Stratasys knew of these issues." (Emphasis in original.)