NEW YORK, Aug. 1, 2008 (PRIME NEWSWIRE) -- The Brualdi Law Firm, P.C. announces that a lawsuit has been commenced in the United States District Court for the Western District of Texas on behalf of purchasers of ArthroCare, Corp. ("ArthroCare" or "the Company") (Nasdaq:ARTC) common stock during the period between January 24, 2008 through July 18, 2008 (the "Class Period") and all persons or entities who purchased call options or sold put options in ArthroCare common stock from October 27, 2006 through July 18, 2008 (the "Options Holders Class Period") for violation of the federal securities laws.
No class has yet been certified in the above action. Until a class is certified, you are not represented by counsel unless you retain one. If you purchased ArthroCare common stock during the period described above, you have certain rights, and have until no later than September 23, 2008 in which to move for Lead Plaintiff status. Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
To be a member of the class you need not take any action at this time, and you may retain counsel of your choice. If you wish to discuss this action or have any questions concerning this Notice or your rights or interests with respect to these matters, please contact Sue Lee at The Brualdi Law Firm, P.C. 29 Broadway, Suite 2400, New York, New York 10006, by telephone toll free at (877) 495-1187 or (212) 952-0602, by email to slee@brualdilawfirm.com or visit our website at http://www.brualdilawfirm.com/.
The complaint alleges that before the market opened on Monday, July 21, 2008, ArthroCare announced that it would be restating its previously reported financial results from the third quarter 2006 through the first quarter 2008 because it improperly recognized revenue from DiscoCare, Inc., State of the Art Medical Products, Boracchia & Associates and Clinical Technology, Inc. As a result, ArthroCare indicated that it expects ArthroCare's reported revenue in 2006 will be reduced by $4 million to $7 million, and that for 2007, reported revenue will be reduced by $20 million to $25 million. Further, ArthroCare revealed on July 21, 2008 that reported revenue for the first quarter of 2008 will be reduced by $2 million to $5 million, and that "the restatement will result in material reductions in operating income and net income for the annual and quarterly periods being restated." Upon that announcement, shares of ArthroCare plummeted from its close of $40.03 on Friday, July 18, 2008 to a close of $23.21 on July 21, 2008, the next day of trading, on extraordinary volume -- a drop of over 42%.