Yep, I’d seen that previous to making the investment recommendation.
1) We don’t know if it’s true or not or if they’d win or lose the lawsuit. So that’s an unknown and why it’s not in our system.
2) The market didn’t react negatively in the after-hours session when it was announced and the stock even rallied the next day. So, it shows that institutions don’t likely think much of it.
3) Companies usually have insurances or umbrella policies etc. to help out with lawsuit payouts.
4) Most any large company you know of usually has one or more lawsuits going at any one time, due to someone always trying to collect something from a larger corporation.
5) The company is still fundamentally strong and fundamentally cheap, regardless.
But for many reasons above, it’s why lawsuits will never make it into our system’s formula as to get into a stock or not.