RINO International Admits 'Problematic Contracts': Hagens Berman Announces Deadline To Move To Be Lead Plaintiff In Investor Lawsuit
SAN FRANCISCO, Nov. 24, 2010 /PRNewswire/ -- Hagens Berman Sobol Shapiro LLP today announced that a class-action lawsuit has been filed against RINO International Corporation (Nasdaq: RINO) in the U.S. District Court of the Central District of California alleging that RINO artificially inflated its stock price by misleading investors about the Company's financial results. The deadline to move to be a lead plaintiff is January 11, 2011. Contact Reed R. Kathrein at 510-725-3030 or at firstname.lastname@example.org for a consultation about whether moving to be lead plaintiff would be right for you.
RINO International is a Chinese-based manufacturer, installer, and servicer of environmental protection equipment, including wastewater treatment and gas desulphurization equipment used in the iron and steel industry.
On Nov. 12, 2010, trading in RINO International stock halted just days after a small research firm posted a report alleging that RINO had engaged in a variety of fraudulent activities, including inflating revenues and fabricating customer relationships. During trading on Nov. 10, 2010 RINO's common stock fell $2.34 per share, closing at $13.18 per share.On Nov. 17, RINO filed a report with the Securities and Exchange Commission stating that Frazer Frost, LLP, the independent auditors of RINO International Corporation (the "Registrant"), delivered a letter (the "Auditor's Letter") to the Registrant and each of its directors. The Auditor's Letter states in part: "In a telephone conversation on Nov. 16, 2010, Mr. Zou Dejun, the Chief Executive Officer of the Company, informed Ms. Susan Woo of our firm, in substance, that as to the six RINO customer contracts discussed in the recent report of Muddy Waters LLC, the Company did not in fact enter into two of the six purported contracts, and a third contract among the six was explainable. When Ms. Woo inquired about the Company's other contracts, Mr. Zou said he was not sure, but there might be problems with 20 - 40% of them." Mr. Zou later claimed that only two of the contracts were "problematic." On Nov. 18, RINO filed a report with the Securities and Exchange Commission stating that the Board concluded that previously issued interim unaudited financial statements which were included in the Registrant's Quarterly Reports on Form 10-Q for the periods March 31, 2010, June 30, 2010 and September 30, 2010 should no longer be relied on inasmuch as such financial statements incorporate results from 2008 and 2009. The filed complaint alleges that RINO artificially inflated its stock price by grossly inflating the Company's financial results. In addition, these financial results were inconsistent with amounts reported to Chinese tax authorities. According to the complaint, RINO and certain company executives made materially false and misleading statements regarding the company's business and operations in violation of the Securities Exchange Act of 1934.
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