NEW YORK, Dec. 14, 2012 (GLOBE NEWSWIRE) -- Pomerantz Grossman Hufford Dahlstrom & Gross LLP has filed a class action lawsuit against SinoHub, Inc. ("SinoHub" or the "Company")(OTC Markets:SIHI) and certain of its officers. The class action filed in United States District Court, Southern District of New York, and docketed under 12 Civ. 8655 is on behalf of a class consisting of all persons or entities who purchased or otherwise acquired securities of SinoHub between May 17, 2010 and August 21, 2012, both dates inclusive (the "Class Period"). This class action seeks to recover damages against the Company and certain of its officers and directors as a result of alleged violations of the federal securities laws pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act and Rule 10b-5 promulgated thereunder.
If you are a shareholder who purchased SinoHub securities during the Class Period, you have until January 21, 2013 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at rswilloughby@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll free, x237. Those who inquire by e-mail are encouraged to include their mailing address and telephone number.
SinoHub is an electronics company based in Shenzhen, People's Republic of China ("PRC"). The Company states that it has over 900 employees, with annual revenue of $196.7 million in 2010.
The Complaint alleges that throughout the Class Period, the Company maintained that the Company's internal controls over financial reporting were effective. However, during the class period, the Company and its officers, knowingly or recklessly implemented, or ignored the existence of, ineffective internal controls, which ultimately resulted in the use of improper accounting procedures and the overstatement of the Company's financial statements and future earnings potential.
On May 16, 2011, the Company announced it would be restating its Form 10-K for 2010 and Form 10-Qs for all three quarters in 2010 due to material misstatements of liabilities and expenses, and significant deficiencies in internal control. On this news SinoHub's stock price dropped from a price of $1.76 per share to a closing price of $1.36, a 23% decline.
On March 30, 2012, the Company released its Form 10-K Annual Report for 2011, which revealed that SinoHub had not experienced any revenue growth during the year. SinoHub's stock price responded accordingly, closing at $0.54 per share on March 30, 2012 after opening that day at $0.63 per share, a decline of 16%.
On August 14, 2012, the Company shocked investors when it announced that it would be unable to file its Quarterly Report on Form 10-Q for June 30, 2012 within the prescribed time period. The Company stated that it expected to file the report within an extension period. Upon the disclosure of this information, and over the next three trading days, SinoHub's stock declined approximately 26%.
Finally, on August 21, 2012, the last day of the Class Period, SinoHub announced that it would not file its Form 10-Q within the extension period as a result of a delay in the Company's retrieval of information requested by the Company's auditors to confirm prior-period sales. The Company announced results for the quarter ended June 30, 2012, stating that it had suffered a net loss of $2.7 million. Over the next three trading days SinoHub's stock price dropped by an additional 20%.
The Pomerantz Firm, with offices in New York, Chicago, and San Diego, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.