China Energy Savings Technology (CESV)

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#15...

Lerach Coughlin Stoia Geller Rudman & Robbins LLP Files Class Action Suit Against China Energy Savings Technology, Inc.
Thursday May 18, 6:15 pm ET


SAN DIEGO--(BUSINESS WIRE)--May 18, 2006--Lerach Coughlin Stoia Geller Rudman & Robbins LLP ("Lerach Coughlin") (http://www.lerachlaw.com/cases/chinaenergy/) today announced that a class action has been commenced in the United States District Court for the Southern District of New York on behalf of purchasers of China Energy Savings Technology, Inc. ("China Energy") (NASDAQ:CESV - News) common stock during the period between April 21, 2005 and February 15, 2006 (the "Class Period").
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If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from May 1, 2006. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, William Lerach or Darren Robbins of Lerach Coughlin at 800/449-4900 or 619/231-1058, or via e-mail at [e-mail]. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.lerachlaw.com/cases/chinaenergy/. 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.

The complaint charges China Energy and certain of its officers and directors with violations of the Securities Exchange Act of 1934. China Energy engages in the development, manufacture, sale, and distribution of energy-saving products for use in commercial and industrial settings in the People's Republic of China.

The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and financial results. As a result of defendants' false statements, China Energy stock traded at artificially inflated prices during the Class Period.

On February 15, 2006, after the market closed, the NASDAQ announced that trading was halted in China Energy stock for "additional information requested" from the Company at a last price of $6.82. As of May 12, 2006, trading in China Energy's stock remained halted.

According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows: (a) the Company's accounting department suffered from material weaknesses and deficiencies and lacked the necessary staff and resources to perform its required functions; (b) contrary to representations contained in the Company's SEC filings, the Company's internal controls were inadequate and easily manipulated; (c) the Company lacked effective internal controls in its financial reporting process required to enable it to properly analyze and/or estimate China Energy's future financial and operational performance; (d) China Energy was improperly recognizing revenue associated with its long-term energy-sharing service agreements by recognizing revenue before it was earned and realizable; (e) China Energy's January 2006 private placement was fraught with self-dealing; and (f) China Energy was experiencing inside and/or self dealing transactions in the Company's stock by insiders, its executives and/or members of its Board of Directors which could lead to trading of its stock being halted by the NASDAQ.

Plaintiff seeks to recover damages on behalf of all purchasers of China Energy common stock during the Class Period (the "Class"). The plaintiff is represented by Lerach Coughlin, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Lerach Coughlin, a 180-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Washington, D.C., Houston, Philadelphia and Seattle, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. Lerach Coughlin lawyers have been responsible for more than $20 billion in aggregate recoveries. The Lerach Coughlin Web site (http://www.lerachlaw.com) has more information about the firm.



Contact:
Lerach Coughlin Stoia Geller Rudman & Robbins LLP
William Lerach or Darren Robbins
800-449-4900 or 619-231-1058
[e-mail]