Robbins Umeda LLP Announces the Filing of a Class Action Suit Against China Medical Technologies, Inc.
09 Januar 2012 - 7:53PM
Business Wire
Shareholder rights firm Robbins Umeda LLP announces the filing
of a federal securities class action by an investor in the U.S.
District Court for the Southern District of New York on behalf of
purchasers of China Medical Technologies, Inc. (NASDAQ: CMED)
shares between November 26, 2007 and December 12, 2011 (the "Class
Period"). Concerned shareholders who would like more information
about their rights and potential remedies can contact attorney
Gregory E. Del Gaizo at (800) 350-6003, gdelgaizo@robbinsumeda.com,
or via the shareholder information form on the firm's website.
The complaint alleges that beginning on November 26, 2007,
certain officers and directors at China Medical Technologies issued
a series of positive statements to investors about the business
condition, future prospects, and true performance of the company
that were materially false and misleading. In particular, the
complaint alleges that officials at China Medical Technologies
withheld material adverse facts from investors that: (1) the
company acquired Beijing Bio-Ekon Biotechnology Co., Ltd. (“BBE”)
from a third-party seller connected to China Medical's chairman, Wu
Xiaodong; (2) the company overpaid by approximately $20 million to
acquire BBE; (3) the BBE acquisition involved the use of fraudulent
shell companies; (4) China Medical Technologies overstated accounts
receivable in order to inflate sales and net income; (5) the
company’s reported profit margins were inflated; and (6) as a
result of the foregoing, the company's statements were materially
false and misleading at all relevant times.
On December 6, 2011, Glaucus Research Group published an analyst
report revealing, in part, that China Medical's Chief Executive
Officer was embezzling money through sham acquisitions, the
company's reported profits and net income were inflated as they
were inconsistent with comparable competitors, and the majority of
the company's account receivables were in excess of 120 days,
indicating that its reported revenues were inflated. On this news,
China Medical Technologies' shares declined $0.81 per share, or
nearly 24%, to close on December 6, 2011 at $2.57 per share.
Robbins Umeda LLP is a nationally recognized leader in
securities litigation and shareholder rights law. The firm
represents individual and institutional investors in shareholder
derivative and securities class action lawsuits, and has helped its
clients realize more than $1 billion of value for themselves and
the companies in which they have invested. For more information,
please go to http://www.robbinsumeda.com.
Press release link:
http://www.robbinsumeda.com/shareholders-rights-blog/china-medical-technologies-inc/
Attorney Advertising. Past results do not guarantee a similar
outcome.
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