NEW YORK, July 5, 2014 (GLOBE NEWSWIRE) -- Wolf Haldenstein Adler Freeman & Herz LLP announces that a class action lawsuit has been filed in the United States District Court, Central District of California, on behalf of all persons who purchased or otherwise acquired common stock of China Agritech, Inc. ("China Agritech" or the "Company") (OTC:CAGC) between November 12, 2009 through March 11, 2011, inclusive (the "Class Period"), against the Company and certain of the Company's officers and directors ("Defendants"), alleging securities fraud pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder.
The litigation is styled Resh v. China Agritech, Inc., C.A. No. 14-cv-05083. A copy of the Complaint filed in this action is available from the Court, or can be viewed on the Wolf Haldenstein Adler Freeman & Herz LLP website at whafh.com.
The Complaint alleges that China Agritech issued materially false and misleading financial statements and created separate financial records for the Securities and Exchange Commission ("SEC") and investors which drastically differed from those filed with Chinese authorities, grossly overstating its revenues and income in reports issued to shareholders. The truth regarding China Agritech's financial statements slowly entered the market despite Defendants' attempts to deny the truth. Particularly, on February 3, 2011, analyst firm LM Research issued a report (the "Report") alleging, among other things, that the Company's statement of revenue and earnings for the fiscal year 2009 were materially false and misleading and referred to the Company as a "scam" with empty, idle factory plants, no necessary licenses and "no value." The Report claimed that China Agritech's U.S. financial statements were materially different than the financial statements filed with Chinese authorities by a number of the Company's subsidiaries and that the revenue reported in the Company's SEC filings for 2009 was ten times larger than what the Chinese regulatory reports had shown. The Report also noted a number of potential incidents of fraud and related party transactions within the Company. When these disclosures of fraud concerning China Agritech were revealed to the market, the price of China Agritech stock dropped dramatically, damaging investors. China Agritech vigorously denied such allegations publicly, yet the stock did not recover, and analysts continued to downgrade CAGC.
After the close of trading on March 11, 2011, NASDAQ announced that it was halting trading due to pending release of news. On March 14, 2011, the Company issued a release announcing the resignation of its independent outside auditor, Ernst & Young Hua Ming. The Company announced that it formed a Special Committee to investigate accounting irregularities and delayed the filing of it 10-K report to the SEC.
On October 17, 2012 the SEC issued an enforcement order revoking the registration of CAGC's stock. Thus, CAGC's stock is no longer publicly traded, effectively rendering it worthless.
If you purchased CAGC common stock during the Class Period, you may request that the Court appoint you as lead plaintiff by September 3, 2014. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Wolf Haldenstein, or other counsel of your choice, to serve as your counsel in this action.
Wolf Haldenstein has extensive experience in the prosecution of securities class actions and derivative litigation in state and federal trial and appellate courts across the country. The firm has over 70 attorneys in various practice areas; and offices in Chicago, New York City, and San Diego. The reputation and expertise of this firm in shareholder and other class litigation has been repeatedly recognized by the courts, which have appointed it to major positions in complex securities multi-district and consolidated litigation.
If you wish to discuss this action or have any questions, please contact Wolf Haldenstein Adler Freeman & Herz by telephone at (800) 575-0735, via e-mail at classmember@whafh.com, or visit our website at www.whafh.com. All e-mail correspondence should make reference to "China Agritech litigation."
Contact:
Wolf Haldenstein Adler Freeman & Herz LLP
Gregory M. Nespole, Esq. or Gregory Stone
Email: Nespole@whafh.com, gstone@whafh.com or classmember@whafh.com
Tel: (800) 575-0735 or (212) 545-4774