Hagens Berman Sobol Shapiro LLP reminds investors of the May 13, 2014 deadline to file for lead plaintiff in the securities fraud class action against CytRx Corporation (NASDAQ: CYTR) (“CytRx” or “the Company”). Investors who have suffered financial losses can contact Hagens Berman Partner Reed Kathrein, who is leading the firm’s investigation, by emailing CytRx@hbsslaw.com , calling 510-725-3000 or visiting http://hb-securities.com/investigations/CytRx.
The securities fraud class-action lawsuit filed against CytRx on March 14, 2014 is on behalf of all persons who purchased or otherwise acquired CytRx stock between Nov. 20, 2013 and March 13, 2014 (the “Class Period”). The lawsuits also cover those who purchased CytRx stock in the offering completed February 5, 2014, in which CytRx netted more than $80 million.
The complaint, filed in the U.S. District Court for the Central District of California, alleges that the defendant violated federal securities laws when it employed The DreamTeam Group to write misleading articles under aliases without disclosing payment for the articles or any affiliation with the company. The complaint alleges that following the dissemination of CytRx’s alleged false stock-promoting statements, the company’s stock traded at artificially inflated prices during the Class Period, reaching a high of $8.35 per share on Jan. 30, 2014.
On Feb. 5 2014, CytRx completed the sale of more than 11 million shares at $6.50 per share, acquiring more than $80 million in net proceeds, according to the complaint.On Feb. 12, 2014, a senior columnist at TheStreet.com published an article, titled “Galena Biopharma Pays For Stock-Touting Campaign While Insiders Cash Out Millions,” claiming an affiliated biotechnology company was engaging in a misleading campaign to boost the company’s stock price. Following its publication, CytRx’s alleged stock-touting practices and employment of the same firm – DreamTeam – were unveiled. Following this news, CytRx's stock price fell from $6.60 to a close of $6.04, declining in value 8.5 percent and damaging investors, according to the complaint.