#United States #New Jersey #Class Action #Pomerantz LLP #Civitas Resources

Pomerantz Law Firm Files Class Action Against Civitas Resources

In a significant legal development, Pomerantz LLP has filed a class action lawsuit against Civitas Resources, Inc. (CIVI) and certain of its officers. The lawsuit, presented in the United States District Court for the District of New Jersey, is set to impact a broad range of investors and stakeholders intimately involved with the company. The case is officially documented as docket number 25-cv-03791 and seeks to protect the rights of individuals and entities who purchased or otherwise acquired securities of Civitas between February 27, 2024, and February 24, 2025.

The lawsuit follows allegations that Civitas and its leadership engaged in misleading practices that violated federal securities laws, specifically under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. Investors are encouraged to act promptly, as they have until July 1, 2025, to request the appointment as Lead Plaintiff. Interested parties can find further information and contact details on Pomerantz's official website.

Civitas Resources Overview

Founded with a focus on developing oil and natural gas resources, Civitas Resources has carved out a niche by operating in key regions like the Denver-Julesburg (DJ) Basin in Colorado and the Permian Basin across Texas and New Mexico. As of the end of 2024, the company reported holding a working interest across approximately 530,200 acres, with revenue primarily derived from the sale of crude oil and natural gas.

Despite maintaining steady production levels throughout 2024, the situation appears to have deteriorated, with the company reporting a peak in oil production at the end of the year—a fact that was not disclosed to investors at the time. The lawsuit claims Civitas executives made false or misleading statements regarding the company’s operational capacity, business health, and growth prospects. Specifically, the complaint argues that Civitas was on track to significantly reduce oil production in 2025 due to a peak production decline in the DJ Basin and insufficient new drilling activity.

Allegations Raised

The court filings assert that Civitas was misleading investors about its ability to maintain production levels and grow revenue. Key allegations include:
1. Overstated production capabilities: Civitas executives failed to disclose that production was likely to decline significantly in 2025, which they attributed to peaks hitting in 2024.
2. Financial distress signs: The company was reportedly under pressure to acquire new acreage and development opportunities, leading to higher debt levels and the potential sale of corporate assets to manage costs.
3. Workforce reduction: As part of efforts to stabilize its financial standing, Civitas planned significant workforce layoffs, which were not communicated until later.
4. Grave misrepresentation of financial outlook: The company's public statements were deemed as materially false and misleading, painting a healthier image of the firm than reality reflected.

Recent Developments

On February 24, 2025, Civitas reported disappointing financial results for the fourth quarter of 2024, registering revenues of $1.29 billion and a net income of $151.1 million, falling short of analysts' expectations. Following this announcement, the company’s stock price plummeted by more than 18%, indicating significant investor fallout. They announced a new strategic plan that included a production decline and the selling of assets to trim debt.

Market analysts responded to the news with caution, with KeyBanc Capital Markets downgrading Civitas’s stock rating. Concerns over the company’s operational strategy become particularly salient, given the significant drop in production estimates moving into 2025 and the troubling absence of new operational updates.

The Role of Pomerantz LLP

Pomerantz LLP has long been recognized as a leader in class action litigation and securities fraud cases. Founded by the late Abraham L. Pomerantz, the firm has an extensive history of advocating for investors and recovering billions in damages for clients in similar situations. Their commitment to fighting corporate misconduct continues to influence securities litigation today.

For those affected, especially former investors, this lawsuit presents a critical opportunity for redress. Stakeholders are advised to assess their involvement between the specified dates in order to take appropriate legal steps as this class action unfolds. Additional details can be obtained through Pomerantz's resources or by contacting the firm directly.