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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 1 of 21
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
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`DAVID MICHAELSON, Individually
`and on Behalf of All Others Similarly
`Situated,
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`Plaintiff,
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`v.
`
`TUFIN SOFTWARE TECHNOLOGIES
`LTD., REUVEN KITOV, JACK
`WAKILEH, REUVEN HARRISON,
`OHAD FINKELSTEIN, EDOUARD
`CUKIERMAN, YAIR SHAMIR,
`RONNI ZEHAVI, and YUVAL
`SHACHAR,
`
`Defendants.
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`Case No.
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`
`
`DEMAND FOR JURY TRIAL
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`
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`
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`CLASS ACTION COMPLAINT FOR VIOLATIONS OF
`FEDERAL SECURITIES LAWS
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`Plaintiff David Michaelson (“Plaintiff”), individually and on behalf of all others similarly
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`situated, by Plaintiff’s undersigned attorneys, alleges the following based upon personal
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`knowledge, as to Plaintiff and Plaintiff’s own acts, and upon information and belief, as to all other
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`matters, based on the investigation conducted by and through Plaintiff’s attorneys, which included,
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`among other things, a review of United States (“U.S.”) Securities and Exchange Commission
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`(“SEC”) filings made by Tufin Software Technologies Ltd. (“Tufin” or the “Company”), analyst
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`and media reports, and the Company’s press releases, among other sources. Plaintiff believes that
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`substantial additional evidentiary support will exist for the allegations set forth herein after a
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`reasonable opportunity for discovery.
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 2 of 21
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`NATURE AND SUMMARY OF THE ACTION
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`1.
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`On March 6, 2019, Tufin filed a registration statement with the SEC on Form F-1,
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`which, after several amendments, was declared effective on April 10, 2019 (the Form F-1, together
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`with all amendments, is referred to herein as the “April Registration Statement”). Thereafter, on
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`April 11, 2019, Tufin filed a prospectus for its initial public offering (the “IPO”) on Form 424B4,
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`which incorporated and formed part of the April Registration Statement (the “April Prospectus”
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`and collectively, with the April Registration Statement, the “IPO Offering Documents”), issuing
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`7,700,000 ordinary shares to the investing public at $14.00 per share (the “IPO Price”), for
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`anticipated gross proceeds of $107,800,000.
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`2.
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`On December 2, 2019, the Company filed a second registration statement with the
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`SEC on Form F-1, which was declared effective on December 5, 2019 (the “December
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`Registration Statement”). Thereafter, on December 5, 2019, Tufin filed a prospectus for its
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`secondary offering (the “SPO”) on Form 424B4, which incorporated and formed part of the
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`December Registration Statement (the “December Prospectus” and collectively, with the
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`December Registration Statement, “SPO Offering Documents”), issuing an additional 4,279,882
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`ordinary shares to the investing public at $17.00 per share (the “SPO Price”), for anticipated gross
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`proceeds of $72,757,994.
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`3.
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`The IPO and SPO Offering Documents (together, the “Offering Documents”) that
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`Tufin and the other Defendants (defined below) used to ultimately secure over $180 million,
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`combined, in net proceeds from investors, however, contained misleading statements in that,
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`among other things: (i) Tufin’s customer relationships and growth metrics were overstated,
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`particularly with respect to North America; (ii) Tufin’s business was deteriorating, primarily in
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`North America; and (iii) as a result, Tufin’s representations regarding its sustainable financial
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`prospects were overly optimistic.
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 3 of 21
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`4.
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`On January 8, 2020, after the market closed, Tufin released its preliminary fourth
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`quarter financial results for 2019 and announced significantly lowered financial expectations,
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`specifically: (i) it expected to report total revenue in the range of $29.5 million to $30.1 million,
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`lowered from its previous guidance of total revenue in the range of $34.0 million to $38.0 million;
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`and (ii) it now anticipated non-Generally Accepted Accounting Principles (“GAAP”) operating
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`loss in the range of $1.1 million to $2.6 million, compared to the previous guidance of non-GAAP
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`operating profit in the range of $0.0 million to $3.0 million. The primary reason given for the
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`revenue shortfall was Tufin’s “inability to close a number of transactions, primarily in North
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`America, that [the Company] anticipated would close but did not close by the end of the quarter.”
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`5.
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`Following this news, Tufin’s share price fell by 24%, or $4.14 per share, and its
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`market capitalization declined by nearly $145 million.
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`6.
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`This securities class action is brought on behalf of Plaintiff and all other persons or
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`entities, except for Defendants, who purchased ordinary shares in the Company’s April 2019 IPO
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`and/or December 2019 SPO pursuant and/or traceable to the misleading Offering Documents.
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`Plaintiff brings this class action under Sections 11 and 15 of the Securities Act of 1933 (the
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`“Securities Act”) against Tufin and certain of the Company’s senior executives, directors, and
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`agents who signed the Offering Documents (collectively, “Defendants”). The Securities Act
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`protects investors and the capital markets of the U.S. by preventing companies and underwriters
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`from issuing shares to investors by means of incomplete and inaccurate offering documents.
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`7.
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`Plaintiff alleges that the Offering Documents contained materially incorrect or
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`misleading statements and/or omitted material information that was required by law to be
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`disclosed. Defendants are each strictly liable for such misstatements and omissions therefrom
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`(subject only, in the case of the Individual Defendants, to their ability to establish a “due diligence”
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 4 of 21
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`affirmative defense and are so liable in their capacities as signers of the Offering Documents,
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`control persons, and/or as issuers, statutory sellers, and/or offerors of the shares sold pursuant to
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`the IPO and SPO (together, the “Offerings”)). Plaintiff expressly disclaims any allegations that
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`could be construed as alleging fraud or intentional or reckless misconduct.
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`JURISDICTION AND VENUE
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`8.
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`The claims asserted herein arise under and are pursuant to Sections 11 and 15 of
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`the Securities Act.
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`9.
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`This Court has jurisdiction over the subject matter of this action pursuant to 28
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`U.S.C. § 1331 and Section 22 of the Securities Act (15 U.S.C. § 77v).
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`10.
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`Venue is proper in this District pursuant to 28 U.S.C. § 1391(b) and Section 22(a)
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`of the Securities Act (15 U.S.C. § 77v(a)) as the alleged misstatements entered and subsequent
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`damages took place within this judicial district. Further, Defendants’ false and misleading
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`statements and omissions were disseminated in this District and Tufin’s ordinary shares are listed
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`on the New York Stock Exchange (“NYSE”), a national securities exchange, which is located in
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`this District.
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`11.
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`In connection with the acts, conduct, and other wrongs alleged in this Complaint,
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`Defendants, directly or indirectly, used the means and instrumentalities of interstate commerce,
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`including, but not limited to, the U.S. mail, interstate telephone communications, and facilities of
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`the national securities exchange.
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`PARTIES
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`12.
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`Plaintiff, as set forth in the attached Certification, purchased Tufin ordinary shares
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`pursuant or traceable to the Offering Documents and was damaged thereby.
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 5 of 21
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`13.
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`Defendant Tufin is an Israeli company that develops, markets, and sells software
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`and cloud-based security solutions primarily in the U.S., Europe, and Asia. Tufin’s ordinary shares
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`trade on the NYSE under the ticker symbol “TUFN.”
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`14.
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`Defendant Reuven Kitov (“Kitov”), who co-founded the Company, served as
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`Tufin’s Chief Executive Officer and Chairman of the Board of Directors (the “Board”) at all
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`relevant times. Defendant Kitov signed, or authorized the signing of, the Offering Documents.
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`15.
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`Defendant Jack Wakileh (“Wakileh”) served as Tufin’s Chief Financial Officer at
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`all relevant times. Defendant Wakileh signed, or authorized the signing of, the Offering
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`Documents.
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`16.
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`Defendant Reuven Harrison (“Harrison”), who co-founded the Company, served as
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`Tufin’s Chief Technology Officer and as a director on the Board at all relevant times. Defendant
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`Harrison signed, or authorized the signing of, the Offering Documents.
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`17.
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`Defendant Ohad Finkelstein (“Finkelstein”) served as a director on the Board at all
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`relevant times. Defendant Finkelstein signed, or authorized the signing of, the Offering
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`Documents.
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`18.
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`Defendant Edouard Cukierman (“Cuikerman”) served as a director on the Board at
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`all relevant times. Defendant Cukierman signed, or authorized the signing of, the Offering
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`Documents.
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`19.
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`Defendant Yair Shamir (“Shamir”) served as a director on the Board at all relevant
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`times. Defendant Shamir signed, or authorized the signing of, the Offering Documents.
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`20.
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`Defendant Ronni Zehavi (“Zehavi”) served as a director on the Board at all relevant
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`times. Defendant Zehavi signed, or authorized the signing of, the Offering Documents.
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 6 of 21
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`21.
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`Defendant Yuval Shachar (“Shachar”) served as a director on the Board at all
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`relevant times. Defendant Shachar signed, or authorized the signing of, the Offering Documents.
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`22.
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`Defendants Kitov, Wakileh, Harrison, Finkelstein, Cuikerman, Shamir, Zehavi, and
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`Shachar are collectively referred to herein as the “Individual Defendants.” The Individual
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`Defendants each signed, or authorized the signing of, the Offering Documents, were director
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`appointees of the Board at the time of the Offerings, solicited the investing public to purchase
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`securities issued pursuant thereto, hired and assisted the underwriters, planned and contributed to
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`the Offerings and their respective Offering Documents, and/or attended or contributed to road
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`shows and other promotions to meet with and present favorable information to potential Tufin
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`investors, all motivated by their own and the Company’s financial interests.
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`23.
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`Tufin and the Individual Defendants are collectively referred to herein as the
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`“Defendants.”
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`SUBSTANTIVE ALLEGATIONS
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`Background
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`24.
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`Founded in 2005 by Defendants Kitov and Harrison, Tufin develops, markets, and
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`sells software and cloud-based security solutions, primarily in the U.S., Europe, and Asia, that is
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`committed to increasing business agility, eliminating errors from manual processes, and ensuring
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`continuous compliance through a single console.
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`25.
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`Tufin offers five products to over 2,000 customers, including approximately 16%
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`of the Global 2000, through a sales force, including field and inside sales teams, and over 140
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`active channel partners, which include distributors and resellers, as well as service delivery
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`partners that help customers deploy, configure, customize, and maintain Tufin’s products and
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`services.
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 7 of 21
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`Materially False and Misleading Statements in the Offering Documents
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`26.
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`The Registration Statement and Prospectus used to effectuate Tufin’s April 2019
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`IPO was false and misleading in that it misled investors with respect to the Company’s North
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`American business and the fact that the Company’s customer relationships and growth metrics
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`were overstated, that Tufin’s business was deteriorating, and that, as a result, Tufin’s
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`representations regarding its sustainable financial prospects were overly optimistic, all of which
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`were known to, but concealed by, Defendants at the time of the IPO.
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`27.
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`For example, for the fiscal year ended December 31, 2018, the IPO Offering
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`Documents reported revenues from the Americas of $48.27 million, comprising 56.8% of Tufin’s
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`total revenues, compared to $35.02 million, or 54.3% of total revenues, for December 31, 2017,
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`thereby indicating both significant revenue growth from the Americas relative to other geographic
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`segments and substantial growth in the America’s segment, specifically.
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`28.
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`The IPO Offering Documents also touted how “[t]he Americas accounted for the
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`majority of [Tufin’s] revenues in each of the years ended December 31, 2017 and 2018, nearly all
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`of which were generated in the United States,” and attributed increased revenues to “primarily [ ]
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`increased sales of [Tufin’s] products and services from new customers . . . and existing customers
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`. . . across all regions,” with such growth “most pronounced in the Americas.”
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`29.
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`In addition, the IPO Offering Documents flaunted Tufin’s purportedly strong
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`customer relationships and technology products, citing both as being core parts of the Company’s
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`growth strategy. For example, the Offering Documents boasted that “[r]evenue generated from
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`[Tufin’s] Global 2000 customers, excluding maintenance renewals, represented an average of 65%
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`of [the Company’s] total revenue over the fiscal years ended December 31, 2016 to 2018” and,
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`further, that Tufin has a “significant growth opportunity with Global 2000 customers that currently
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`lack a security policy management solution or that use a competing product that lacks automation.”
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 8 of 21
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`30.
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`The foregoing statements were materially
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`inaccurate, misleading, and/or
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`incomplete because they failed to disclose, inter alia, that the Company’s North American business
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`was suffering at the time of Tufin’s IPO. More specifically: (i) Tufin’s customer relationships and
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`growth metrics were overstated, primarily because of its North American business; (ii) Tufin’s
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`business was deteriorating, especially in North America; and (iii) Tufin’s representations regarding
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`its sustainable financial prospects were, as a result, overly optimistic.
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`31. With the foregoing materially false and misleading statements in the IPO Offering
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`Documents, the IPO was successful for the Company and its executives and directors, with the
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`Company selling 7.7 million ordinary shares to Plaintiff and other members of the investing public,
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`priced at $14.00 per share, raising approximately $107.8 million in capital.
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`32.
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`The Registration Statement and Prospectus used to effectuate Tufin’s December
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`2019 SPO was similarly false and misleading as it continued to mislead investors with respect to
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`the Company’s North American business and the fact that the Company’s customer relationships
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`and growth metrics were overstated, that Tufin’s business was deteriorating, and that, as a result,
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`Tufin’s representations regarding its sustainable financial prospects were overly optimistic, all of
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`which were known to, but concealed by, Defendants at the time of the SPO.
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`33.
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`For example, as was stated in Tufin’s IPO Offering Documents, the SPO Offering
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`Documents claimed that Tufin’s revenues from the Americas, for the fiscal year ended December
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`31, 2018, were $48.27 million, comprising 56.8% of Tufin’s total revenues, compared to $35.02
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`million, or 54.3%, of total revenues for December 31, 2017. As a result, Defendants again
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`indicated that Tufin experienced significant revenue growth from the Americas relative to other
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`geographic segments and that Tufin experienced substantial growth in the America’s segment,
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`specifically.
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 9 of 21
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`34.
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`Additionally, the SPO Offering Documents repeated the assertion made in Tufin’s
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`IPO Offering Documents that “[t]he Americas accounted for the majority of [the Company’s]
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`revenues in each of the years ended December 31, 2017 and 2018,” adding further that the same
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`was true “in each of the nine months ended September 30, 2018 and 2019.” Moreover, the SPO
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`Offering Documents credited Tufin’s increased revenues “to increased sales of [the Company’s]
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`products and services from new customers . . . and existing customers . . . across all regions,” but
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`that such growth was “most pronounced in the Americas.”
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`35.
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`The SPO Offering Documents also continued to boast about Tufin’s strong
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`customer relationships and technology products, repeating the same about how “[r]evenue
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`generated from [Tufin’s] Global 2000 customers, excluding maintenance renewals, represented an
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`average of 65% of [the Company’s] total revenue over the fiscal years ended December 31, 2016
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`to 2018” and that Tufin has a “significant growth opportunity with Global 2000 customers that
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`currently lack a security policy management solution or that use a competing product that lacks
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`automation.”
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`36.
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`The foregoing statements were materially
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`inaccurate, misleading, and/or
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`incomplete because, again, they failed to disclose, inter alia, that the Company’s North American
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`business was suffering, this time as of Tufin’s SPO. More specifically: (i) Tufin’s customer
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`relationships and growth metrics were overstated, primarily because of its North America business;
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`(ii) Tufin’s business was deteriorating, especially in North America; and (iii) Tufin’s
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`representations regarding its sustainable financial prospects were, as a result, overly optimistic.
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`37. With the foregoing materially untrue and misleading statements in the SPO
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`Offering Documents, the SPO was successful for the Company and its executives and directors,
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 10 of 21
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`with the Company selling nearly 4.28 million Tufin ordinary shares to the public at $17.00 per
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`share, generating more than $72.7 million in gross proceeds.
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`38.
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`In addition, Item 303 of SEC Regulation S-K, 17 C.F.R. § 229.303 (“Item 303”),
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`imposed an independent duty on Defendants to disclose in the Offering Documents any known
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`events or uncertainties that Tufin “reasonably expects will have a material favorable or unfavorable
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`impact on the sales or revenues or income from continuing operations.” Defendants violated Item
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`303 by failing to disclose that, at the time of both the Offerings: (i) Tufin’s customer relationships
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`and growth metrics were overstated, primarily because of its North America business; (ii) Tufin’s
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`business was deteriorating, especially in North America; and (iii) Tufin’s representations regarding
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`its sustainable financial prospects were, as a result, overly optimistic. These facts were likely to
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`(and in fact did) materially and adversely affect Tufin’s future results and prospects.
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`39.
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`Further, Item 503 of SEC Regulation S-K, 17 C.F.R. § 229.503 (“Item 503”), also
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`imposes an independent duty on Defendants to ensure that the “Risk Factors” section of the
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`Offering Documents discuss “the most significant factors that make the offering speculative or
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`risky” and that each risk factor “adequately describes the risk.” Tufin’s discussions of risk factors
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`did not mention, much less adequately describe, the actual significant risks associated with the
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`sustainability of its customer relationships and financial prospects, particularly in North America.
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`Instead, the IPO Offering Documents contained generic boilerplate representations regarding
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`seasonality in Tufin’s sales, noting that Tufin’s “sales cycle is long and unpredictable, which may
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`cause significant fluctuations in [its] quarterly results of operations,” that “[t]he loss or delay of
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`one or more large transactions in a quarter could impact [Tufin’s] anticipated results of operations
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`for that quarter and future quarters for which revenue from the transaction is delayed,” and that the
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`Company “may not be able to accurately predict or forecast the timing of sales, which could cause
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 11 of 21
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`[Tufin’s] results to vary significantly from [the Company’s] expectations and the expectations of
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`market analysts.”
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`The Truth Begins to Emerge
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`40.
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`The true facts regarding the Offering Documents began to emerge after both the
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`Offerings. Indeed, in the immediate wake of the SPO, on January 9, 2020, Tufin’s share price
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`declined as investors processed the Company’s preliminary unaudited revenue and non-GAAP
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`operating loss estimates for its fourth fiscal quarter of 2019. Notably, Tufin said that it expected
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`to report total revenue in the range of $29.5 million to $30.1 million, compared to its previous
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`guidance of total revenue in the range of $34.0 million to $38.0 million, and that Tufin anticipated
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`non-GAAP operating loss in the range of $1.1 million to $2.6 million, compared to the Company’s
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`previous guidance of non-GAAP operating profit in the range of $0.0 million to $3.0 million.
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`According to Defendant Kitov, “[t]he primary reason for [Tufin’s] revenue shortfall was [its]
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`inability to close a number of transactions, primarily in North America, that [Defendants]
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`anticipated would close but did not close by the end of the quarter.” On this news, Tufin’s shares
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`fells $4.14 per share, or 24.04%, to close at $13.08 per share on January 9, 2020.
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`41.
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`As of the time this Complaint was filed, Tufin shares continued to trade
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`significantly below both the IPO price of $14.00 per share and the SPO price of $17.00 per share.
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`42.
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`As a result of Defendants’ wrongful acts and omissions, and the precipitous decline
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`in the market value of Tufin’s securities, Plaintiff and other Class members have suffered
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`significant losses and damages.
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`PLAINTIFF’S CLASS ACTION ALLEGATIONS
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`43.
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`Plaintiff brings this action on behalf of a class consisting of all persons or entities
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`that purchased Tufin ordinary shares in or traceable to both the Offerings pursuant to their
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`respective Offering Documents and who were damaged thereby (the “Class”). Excluded from the
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 12 of 21
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`Class are: the Defendants and Individual Defendants’ immediate family members; the officers,
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`directors, affiliates, and subsidiaries of Tufin and underwriters for the Offerings, at all relevant
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`times, including Tufin’s employee retirement and/or benefit plan(s), and their participants or
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`beneficiaries, to the extent they made purchases through such plan(s); counsel of record for all
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`parties; any entity in which Defendants have or had a controlling interest (but in the case of the
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`underwriters for the Offerings, only such entities that they have a majority ownership interest in);
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`and the legal representatives, heirs, successors, or assigns of any such excluded person or entity.
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`44.
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`The members of the Class are so numerous that joinder of all members is
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`impracticable. Throughout the Offerings, Tufin ordinary shares were actively traded on the NYSE.
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`While the exact number of Class members is unknown to Plaintiff at this time, and can only be
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`ascertained through appropriate discovery, Plaintiff believes that there are thousands of members
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`in the proposed Class. The members of the proposed Class may be identified from records
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`maintained by the Company or its transfer agent and may be notified of the pendency of this action
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`by mail, using customary forms of notice that are commonly used in securities class actions.
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`45.
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`Plaintiff’s claims are typical of the claims of the members of the Class, as all
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`members of the Class are similarly affected by Defendants’ wrongful conduct.
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`46.
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`Plaintiff will fairly and adequately protect the interests of the members of the Class
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`and has retained counsel competent and experienced in class action and securities litigation.
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`Plaintiff has no interest, antagonism, or conflict with the members of the Class.
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`47.
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`Common questions of law and fact exist as to all members of the Class and
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`predominate over any questions solely affecting individual members of the Class. Among the
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`questions of law and fact common to the Class are:
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 13 of 21
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`(a)
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`whether the federal securities laws were violated by Defendants’ acts, as
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`alleged herein;
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`(b)
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`whether the Offering Documents contained materially false and misleading
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`statements and omissions; and
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`(c)
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`to what extent Plaintiff and the other members of the Class have sustained
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`damages, and the proper measure of damages.
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`48.
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`A class action is superior to all other available methods for the fair and efficient
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`adjudication of this controversy, since joinder of all members is impracticable. Furthermore, as
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`the damages suffered by individual Class members may be relatively small, the expense and
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`burden of individual litigation make it impossible for members of the Class to individually redress
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`the wrongs done to them. There will be no difficulty in the management of this action as a class
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`action.
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`49.
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`COUNT I
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`(Violations of Section 11 of the Securities Act Against All Defendants)
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`Plaintiff repeats and realleges each and every allegation contained above as if fully
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`set forth herein.
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`50.
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`This Count is brought pursuant to Section 11 of the Securities Act, 15 U.S.C. § 77k,
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`on behalf of the Class, against each of the Defendants.
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`51.
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`This is a non-fraud Count. Plaintiff does not assert that Defendants committed
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`intentional or reckless misconduct or that Defendants acted with scienter or fraudulent intent.
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`52.
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`The April and December Registration Statements were inaccurate and misleading,
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`contained untrue statements of material facts, omitted facts necessary to make the statements made
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`therein not misleading, and omitted to state material facts required to be stated therein.
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 14 of 21
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`53.
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`The Defendants named herein are strictly liable to Plaintiff and the Class for the
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`misstatements and omissions.
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`54.
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`None of the Defendants named herein made a reasonable investigation or possessed
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`reasonable grounds for the belief that the statements contained in the April and December
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`Registration Statements were true and without omissions of any material facts and were not
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`misleading.
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`55.
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`Defendant Tufin is the registrant of the securities purchased by Plaintiff and the
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`Class. As such, the Company is strictly liable for the materially inaccurate statements contained
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`in the Offering Documents and the failure of the Offering Documents to be complete and accurate.
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`By virtue of the Offering Documents containing material misrepresentations and omissions of
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`material fact necessary to make the statements therein not false and misleading, Tufin is liable
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`under Section 11 of the Securities Act to Plaintiff and the Class.
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`56.
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`The Individual Defendants each signed the Offering Documents and caused their
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`issuance. As such, each is strictly liable for the materially inaccurate statements contained in the
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`Offering Documents and the failure of the Offering Documents to be complete and accurate, unless
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`they are able to carry their burden of establishing an affirmative “due diligence” defense. The
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`Individual Defendants each had a duty to make a reasonable and diligent investigation of the
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`truthfulness and accuracy of the statements contained in the Offering Documents and ensure that
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`they were true and accurate, there were no omissions of material facts that would make the
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`Offering Documents misleading, and the Offering Documents contained all facts required to be
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`stated therein. In the exercise of reasonable care, the Individual Defendants should have known
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`of the material misstatements and omissions contained in the Offering Documents and also should
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 15 of 21
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`
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`have known of the omissions of material fact necessary to make the statements made therein not
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`misleading. Accordingly, the Individual Defendants are liable to Plaintiff and the Class.
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`57.
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`Defendants acted negligently in preparing the Offering Documents. None of the
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`Defendants named in this Count made a reasonable investigation or possessed reasonable grounds
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`for the belief that the statements contained in the Offering Documents were true and without
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`omission of any material facts and were not misleading. In alleging the foregoing, Plaintiff
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`specifically disclaims any allegation of fraud.
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`58.
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`By reason of the conduct alleged herein, each Defendant named in this Count
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`violated Section 11 of the Securities Act.
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`59.
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`None of the untrue statements or omissions of material fact in the Offering
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`Documents alleged herein was a forward-looking statement. Rather, each such statement
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`concerned existing facts. Moreover, the Offering Documents did not properly identify any of the
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`untrue statements as forward-looking statements and did not disclose information that undermined
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`the putative validity of these statements.
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`60.
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`Plaintiff acquired the Company’s ordinary shares pursuant or traceable to the
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`Offering Documents and without knowledge of the untruths and/or omissions alleged herein.
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`Plaintiff sustained damages, and the price of the Company’s ordinary shares declined substantially
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`because of material misstatements in the Offering Documents.
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`61.
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`This Count is brought within one year after the discovery of the untrue statements
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`and omissions and within three years of the date of the Offerings.
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`62.
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`By virtue of the foregoing, Plaintiff and the other members of the Class are entitled
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`to damages under Section 11, as measured by the provisions of Section 11(e), from the Defendants
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`and each of them, jointly and severally.
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`
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`Case 1:20-cv-06290 Document 1 Filed 08/10/20 Page 16 of 21
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`COUNT II
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`(Violations of Section 15 of the Securities Act Against the Individual Defendants)
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`63.
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`Plaintiff repeats and realleges each and every allegation contained above as if fully
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`set forth herein.
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`64.
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`This Count is brought pursuant to Section 15 of the Securities Act, 15 U.S.C. § 77o,
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`on behalf of the Class, against each of the Individual Defendants.
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`65.
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`The Individual Defendants were controlling persons of the Company within the
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`meaning of Section 15 of the Securities Act. By reason of their ownership interest in, senior
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`management positions at, and/or directorships held at the Company, as alleged above, these
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`Defendants invested in, individually and collectively, had the power to influence, and exercised
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`the same over the Company to cause it to engage in the conduct complained of herein. The
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`Company controlled the Individual Defendants and all of Tufin’s employees.
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`66.
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`Similarly, each of the other Individual Defendants not only controlled those subject
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`to liability as primary violators of Section 11 of the Securities Act, as alleged in Count I above,
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`they directly participated in controlling Tufin by having signed or authorized the signing of the
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`Offering Documents and authorizing the issuance of Tufin ordinary shares to Plaintiff and
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`members of the Class.
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`67.
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`As control persons of Tufin, each of the Individual Defendants are jointly and
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`severally liable pursuant to Section 15 of the Securities Act with and to the same extent as Tufin
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`for its violations of Section 11 of the Securities Act.
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`PRAYER FOR RELIEF
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`WHEREFORE, Plaintiff, on behalf of Plaintiff and the other members of the Class, prays
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`for judgment as follows:
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`
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`A.
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`Declaring that the instant action may be maintained as a class action under Federal
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`Rule of Civil Procedure 23 and certifying Plaintiff as the Class Representative;
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`B.
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`Awarding Plaintiff and the other members of the Class compensatory damages
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`against all Defendants, jointly and severally, for all damages sustained as a result of Defendants’
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`wrongdoing in an amount to be proven at trial, including interest thereon;
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`C.
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`Awarding Plaintiff and the other members of the Class pre-judgment and post-
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`judgment interest, as well as reasonable attorneys’ fees, expert witness fees, and other costs and
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`disbursements; and
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`D.
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`Awarding Plaintiff and the other members of the Class such other and further relief
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`as the Court may deem just and proper.
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`JURY TRIAL DEMANDED
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`Plaintiff hereby demands a trial by jury.
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`DATED: August 10, 2020
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`Respectfully submitted,
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`POMERANTZ LLP
`
`/s/ Jeremy A. Lieberman
`Jeremy A. Lieberman
`J. Alexander Hood II
`600 Third Avenue, 20th Floor
`New York, N