Rigrodsky & Long, P.A. Announces Investigation Of JBI, Inc. For Possible Violations Of The Federal Securities Laws

Rigrodsky & Long, P.A. announces that it has launched an investigation on behalf of the purchasers of the common stock of JBI, Inc. (“JBI” or the “Company”) (OTC: JBII.PK) during the period November 16, 2009 to January 3, 2012, inclusive (the “Relevant Period”) concerning whether the Company and certain of its officers and directors have possibly violated the federal securities laws.

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During the Relevant Period, JBI purported to be a technology company focused on data restoration and recovery and environmentally engineered product development. JBI is purportedly involved in the research and development of a process designed to convert plastic waste into oil, known as “Plastic2Oil” or “P2O.”

On January 4, 2012, the United States Securities and Exchange Commission (the “SEC”) filed a complaint in the United States District Court for the District of Massachusetts alleging, among other things, that:

During the third quarter of 2009 and the year end 2009, JBI materially overstated certain assets in an effort to bolster its balance sheet. Specifically, in its financials JBI listed media credits purchased by the company for $1,000,000 in common stock as having a value of $9,997,134, which made the media credits the single largest asset on JBI’s balance sheet. ...

The almost 1,000% overvaluation of the media credits substantially misrepresented the actual value of JBI’s assets and, hence, of the company itself. The Defendants then used the overvalued financial statements in two private capital raising efforts (Private Investment in Public Equity or PIPES) geared toward raising the capital necessary to begin commercial operation and production of P2O. JBI raised over $8.4 million for the company in these PIPES relying on misrepresentations to investors about the company’s assets and valuation. Shortly after obtaining the approximately $8.4 million in financing the company issued a public statement indicating its financial statements could no longer be relied upon due, in part, to the erroneous valuation of certain assets on the balance sheet ( i.e., the media credits, among other things).

The price of the Company's common stock dropped more than 61% on disclosure of the SEC action and the foregoing allegations, falling from a closing price of $2.35 per share on January 3, 2012 (the day before the disclosure) to a close of $0.86 per share on January 4, 2012 (the day of the disclosure), on unusually high trading volume.