On February 28, 2012, Wolf Haldenstein Adler Freeman & Herz LLP filed a class action lawsuit in the United States District Court, Southern District of New York, on behalf of all persons who purchased the common stock of New Energy Systems Group (“New Energy” or the “Company”) (AMEX:NEWN) between April 15, 2010 and November 14, 2011, inclusive (the “Class Period”), against the Company and certain of the Company’s current and former officers and directors, alleging fraud pursuant to Sections 10(b) and 20(a) of the Exchange Act [15 U.S.C. §§ 78j(b) and 78t(a)] and Rule 10b-5 promulgated thereunder by the SEC [17 C.F.R. § 240.10b-5] (the “Class”).
The case name is styled Santana v. Li, et al. A copy of the complaint filed in this action is available from the Court, or can be viewed on the Wolf Haldenstein Adler Freeman & Herz LLP website at www.whafh.com.
The complaint alleges that Defendants knew or recklessly disregarded numerous facts known to them before and during the Class Period concerning its profitability, the legitimacy of the Company’s business and that the Company expected it would continually receive orders from its “loyal customers.” It is further alleged that Defendants issued statements in its SEC filings that were materially false and misleading. Specifically:
a) Defendants knew that New Energy did not have a loyal customer base and, therefore, knew that there was no reason to believe that the Company would continually receive orders;b) Defendants knew that New Energy did not produce batteries that were sought after by the market; c) Defendants hid the material adverse effect of counterfeit products on New Energy’s business. The filings failed to state New Energy’s inability to cease the counterfeiting of its products; and d) the filings failed to state that increased competition had caused a permanent slowdown in sales.