Lieff, Cabraser, Heimann & Bernstein, LLP Announces Class Action Lawsuits Against SinoTech Energy Limited
(here come the ambulance chasers, first of probably 8-10) actually surprised it took this long
press release
Aug. 26, 2011, 9:30 a.m. EDT
Lieff, Cabraser, Heimann & Bernstein, LLP Announces Class Action Lawsuits Against SinoTech Energy Limited
SAN FRANCISCO, Aug 26, 2011 (BUSINESS WIRE) -- The law firm of Lieff, Cabraser, Heimann & Bernstein, LLP is investigating potential securities law violations as alleged in class action lawsuits brought on behalf of all purchasers of American Depository Shares ("ADS") of SinoTech Energy Limited ("SinoTech" or the "Company") /quotes/zigman/623628/quotes/nls/cte CTE 0.00% between November 3, 2010 and August 16, 2011 (the "Class Period"), including purchasers of SinoTech ADSs in the Company's initial public offering (the "IPO") on November 3, 2010.
If you purchased or acquired SinoTech ADSs during the Class Period and/or in the IPO, you may move the Court for appointment as lead plaintiff by no later than October 18, 2011. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. Your share of any recovery in the action will not be affected by your decision of whether to seek appointment as lead plaintiff. You may retain Lieff Cabraser, or other attorneys, as your counsel in the action.
SinoTech shareholders who wish to learn more about the action and how to seek appointment as lead plaintiff should click here or contact Sharon Lee of Lieff Cabraser toll free at (800) 541-7358.
Background on the SinoTech Securities Class Litigation
The actions are brought against SinoTech and certain of its officers and directors, underwriters of its IPO, and auditors for violations of the Securities Act of 1933 and the Securities Exchange Act of 1934. SinoTech, headquartered in Beijing, China, purports to provide enhanced oil recovery services to major oil and gas companies in China.
The lawsuits allege that SinoTech's financial reports were materially false because the nature, size and scope of the Company's business were materially exaggerated. Specifically, the complaints allege that: (1) the Company's sole import agent, which accounted for more than $100 million worth of oil drilling equipment orders, is an empty shell company with no sign of operations; (2) the Company's only chemical supplier is also an empty shell company, with little or no revenues; (3) the Company's largest subcontracting customer, which provides the vast majority of SinoTech's revenues, has unverifiable operations with minimal revenues; (4) the financial statements SinoTech issued in the United States are inconsistent with similar filings the Company made in China; (5) the Company engaged in undisclosed related-party transactions in violation of Generally Accepted Accounting Principles; and (6) the Company's statements regarding its internal financial controls were false and misleading.
On August 16, 2011, an anonymous research analyst published a report detailing numerous problems with SinoTech's previously issued financial statements and future prospects. On that day, the Company's stock price dropped more than 40%, falling from $4.02 per share on August 15, 2011 to $2.35 per share at the close of trading on August 16, 2011 -- a decline of $1.67 per share on unusually high trading volume. After the market closed on August 15, 2011, the NASDAQ halted trading in SinoTech stock and announced that trading would remain halted until the Company "fully satisfied NASDAQ's request for additional information." To date, trading in the stock remains halted.
