Navistar slumps after saying SEC may file lawsuit

SHARE Navistar slumps after saying SEC may file lawsuit

Truck and engine maker Navistar said Wednesday that securities regulators may file a lawsuit against the company in a dispute over environmental certification of heavy-duty diesel engines.

The Securities and Exchange Commission is investigating possible violations of both securities law and a previous settlement between Navistar and the SEC. The Lisle, Illinois-based company’s shares dropped more than 4 percent.

Navistar said it received “Wells Notices” from the SEC on Aug. 13 and 17, which means the SEC’s investigators are recommending that the agency take civil action against the company and former Chairman and CEO Daniel Ustian. The SEC is also investigating Navistar’s disclosures regarding Ustian’s retirement in August 2012.

Navistar said it is cooperating with the SEC, although the two sides have gone to court in a dispute over some of the documents the agency requested. A court ordered Navistar to turn over some of those documents but said it wasn’t required to hand over others.

Shares of Navistar lost 75 cents to close at $16.61. The shares have fallen 57 percent over the last year and are trading around their lowest prices since March 2009.

In July the Justice Department sued Navistar on behalf of the Environmental Protection Agency, saying the company sold 7,750 diesel engines that didn’t meet 2010 emissions standards. The company says the engines weren’t subject to the standards because they were made in 2009, while the EPA says they were made in 2010.

The government is seeking about $290 million in civil penalties from the Lisle, Illinois-based company.

The SEC previously investigated Navistar and said the company overstated its pretax income by about $137 million from 2001 to 2005. It said management did not exert enough oversight over the company’s accounting and reporting operations. As part of a settlement in 2010, several executives agreed to pay civil penalties and Ustian returned part of his 2004 bonus.

Navistar International Corp., which hasn’t reported a quarterly profit since late 2012, also said it lost $28 million, or 34 cents per share, in its fiscal third quarter. Excluding one-time items the company reported a loss of 19 cents per share. Its revenue in the three months ended July 31 fell 1 percent to $2.54 billion.

Analysts expected a profit of 11 cents per share and $2.76 billion in revenue, according to Zacks Investment Research.

The Latest
Two people opened fire around 1:10 a.m. in the 4700 block of South Princeton Avenue and struck one person in the leg, a 60-year-old man in the arm and a 37-year-old man in the body, according to Chicago police.
Over-policing students, most of whom are Black, has turned our schools into punitive institutions that hurt the most vulnerable kids.
Divorced man seems to be into his single co-worker, who is not interested.
A federal appeals court panel suspended the Fearless Fund grant program for Black women business owners. The lawsuit claimed that it violates federal civil rights law. That’s a cynical weaponization of the law and ignores long-standing racial disparities.
Thinking ahead to your next few meals? Here are some main dishes and sides to try.