Lieff Cabraser Heimann & Bernstein, LLP Announces Class Action Lawsuit Against Career Education Corporation
February 02 2012 - 1:18PM
Business Wire
The law firm of Lieff Cabraser Heimann & Bernstein, LLP
announces that a class action lawsuit has been brought on behalf of
purchasers of the common stock of Career Education Corporation
(“Career Education” or the “Company”)
(NasdaqGS: CECO) between January 1, 2009 and
November 1, 2011, inclusive (the “Class Period”).
If you purchased Career Education common stock during the Class
Period, you may move the Court for appointment as lead plaintiff by
no later than March 13, 2012. A lead plaintiff
is a representative party who acts on behalf of other class members
in directing the litigation. Your share of any
recovery in the action will not be affected by your decision of
whether to seek appointment as lead plaintiff.
You may retain Lieff Cabraser, or other attorneys, as your counsel
in the action.
Career Education shareholders who wish to learn more about the
action and how to seek appointment as lead plaintiff should click
here or contact Sharon Lee of Lieff Cabraser toll free at (800)
541-7358.
Background on the Career Education
Securities Class Litigation
The action is brought against Career Education and certain of
its senior officers for violations of the Securities Exchange Act
of 1934. Headquartered in Schaumburg,
Illinois, Career Education is a for-profit education company that
operates more than 90 campuses in the United States, France, Italy,
the United Kingdom, and Monaco.
The complaint alleges that during the Class Period, defendants
misrepresented and omitted material information about Career
Education’s business and financial condition.
Specifically, defendants failed to disclose that Career Education
improperly reported false and inflated job placement rates of its
students after graduation to accrediting agencies so that its
schools could obtain the necessary accreditations to receive
lucrative funding through federal and state student financial aid
and loan programs.
On May 17, 2011, Career Education received a subpoena from the
Attorney General of the State of New York requesting documents
pertaining to student recruitment and admissions, employment
outcomes, and graduate placement rates, among other things.
After disclosing the subpoena on May 24, 2011,
the Company’s stock price fell 1.2 percent to close at $21.69 on
May 25, 2011.
On August 3, 2011, Career Education announced that it had
“identified improper practices at certain of its health education
segment campuses relating to the determination of reported
placement rates” and that it had retained outside legal counsel to
conduct an investigation. Following this
announcement, the Company’s stock price fell $3.36 per share, or
15.4 percent, to close at $18.51 on August 4, 2011, on unusually
high trading volume.
Then, on November 1, 2011, Career Education announced that
its outside counsel confirmed the existence of improper placement
practices at certain of the Company’s schools and, further, that
only 13 of 49 Health Education and Art & Design schools
accredited by the agency ACICS met the agency’s 65% minimum job
placement rate standard. On the same day, the Company
revealed that its then-President and Chief Executive Officer,
defendant Gary E. McCullough, had resigned abruptly. In
reaction to these announcements, the price of Career Education
stock fell $7.63 per share, or 47.8 percent, to close at $8.32 on
November 2, 2011, on extremely high trading volume.
About Lieff Cabraser
Lieff Cabraser Heimann & Bernstein, LLP, with offices in San
Francisco, New York and Nashville, is a nationally recognized law
firm committed to advancing the rights of investors and promoting
corporate responsibility.
Since 2003, the National Law Journal has selected Lieff Cabraser
as one of the top plaintiffs’ law firms in the
nation. In compiling the list, the National Law
Journal examined recent verdicts and settlements in addition to
overall track records. Lieff Cabraser is one of only two
plaintiffs’ law firms in the United States to receive this honor
for the last nine consecutive years.
For more information about Lieff Cabraser and the firm’s
representation of investors, please visit
http://www.lieffcabraser.com.
This press release may be considered Attorney Advertising in
some jurisdictions under the applicable law and ethical rules.
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