What were they saving it for?

April 20, 2005

Though I don’t typically post twice in one day, something in this afternoon’s filings caught my eye. Covansys Corp. (CVNS) received a subpoena from the SEC last Thursday (April 14). But it decided to wait until today (April 20) to inform its investors of this news. Now I realize that SEC subpoenas aren’t all that uncommon, which makes it even stranger that the company would choose to wait nearly a week. Covansys told investors today, waiting until 4:55 p.m. to file its 8-K. Why even wait until after the market closed? Even odder is that the company decided to package the subpoena news, which seeks documents from January 2002 to the present, with the resignation of director James Barlett. So the company can take six days to disclose an SEC subpoena, but manage to immediately file an 8-K on a director resigning? And if Barlett didn’t resign today, how much longer would investors have had to wait? Coincidentally, the stock has been falling since last Thursday. So the next question is: who was doing that selling and what were they basing their decision on?

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