The Rosen Law Firm, P.A. today announced that it has filed class action lawsuit on behalf of investors who purchased the common stock of AgFeed Industries, Inc. (NASDAQ: FEED) during the period between March 16, 2009 and August 2, 2011, inclusive, and is seeking to recover investors’ damages from violations of federal securities laws.
To join the AgFeed class action, visit the Rosen Law Firm’s website at http://www.rosenlegal.com, or call Phillip Kim, Esq., toll-free, at 866-767-3653; you may also email or firstname.lastname@example.org for information on the class action, 如果您講中文，請致電張律師212-686-1060，或電郵 email@example.com, 獲取該集體訴訟案件的具體信息. The action filed by the firm is pending in the U.S. District Court for the District of Colorado.
NO CLASS HAS YET BEEN CERTIFIED IN THE ABOVE ACTION. UNTIL A CLASS IS CERTIFIED, YOU ARE NOT REPRESENTED BY COUNSEL UNLESS YOU RETAIN ONE. YOU MAY CHOOSE TO DO NOTHING AT THIS POINT AND REMAIN AN ABSENT CLASS MEMBER.
The Complaint asserts violations of the federal securities laws against AgFeed and its officers and directors for issuing false and misleading information to investors about the Company’s true financial and business condition. Namely, the Complaint alleges that (1) AgFeed avoided correctly reporting the Company’s bad debt levels by relying on a flawed analysis; (2) the Company’s allowances for doubtful accounts were highly undervalued; and (3) AgFeed’s accounts receivable were overvalued and its bad debts were undervalued, causing reported asset values to be overstated and expenses to be understated.On August 2, 2011, AgFeed announced disappointing preliminary second quarter financial results, including an anticipated loss of $17 million and $5 million in allowances for bad debt expenses. A week later, AgFeed disclosed in its Form 10-Q filed with the SEC that the Company had only $13.2 million in accounts receivables, net of a $7 million allowance for doubtful accounts as of June 30, 2011. This is in stark contrast to the $28.6 million in accounts receivable, net of a $1.9 million allowance for doubtful accounts, for the prior quarter. On September 29, 2011, AgFeed’s Board established a special committee to investigate the Company’s accounting practices in relation to its Chinese operations.