Lieff, Cabraser, Heimann & Bernstein, LLP Announces Class Action Lawsuits Against SinoTech Energy Limited
August 26 2011 - 9:30AM
Business Wire
The law firm of Lieff, Cabraser, Heimann & Bernstein, LLP is
investigating potential securities law violations as alleged in
class action lawsuits brought on behalf of all purchasers of
American Depository Shares (“ADS”) of SinoTech Energy Limited
(“SinoTech” or the “Company”) (NASDAQ:CTE) between November 3, 2010
and August 16, 2011 (the “Class Period”), including purchasers of
SinoTech ADSs in the Company’s initial public offering (the “IPO”)
on November 3, 2010.
If you purchased or acquired SinoTech ADSs during the Class
Period and/or in the IPO, you may move the Court for appointment as
lead plaintiff by no later than October 18, 2011. 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.
SinoTech 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 SinoTech Securities
Class Litigation
The actions are brought against SinoTech and certain of its
officers and directors, underwriters of its IPO, and auditors for
violations of the Securities Act of 1933 and the Securities
Exchange Act of 1934. SinoTech, headquartered in Beijing, China,
purports to provide enhanced oil recovery services to major oil and
gas companies in China.
The lawsuits allege that SinoTech’s financial reports were
materially false because the nature, size and scope of the
Company’s business were materially exaggerated. Specifically, the
complaints allege that: (1) the Company’s sole import agent, which
accounted for more than $100 million worth of oil drilling
equipment orders, is an empty shell company with no sign of
operations; (2) the Company’s only chemical supplier is also an
empty shell company, with little or no revenues; (3) the Company’s
largest subcontracting customer, which provides the vast majority
of SinoTech’s revenues, has unverifiable operations with minimal
revenues; (4) the financial statements SinoTech issued in the
United States are inconsistent with similar filings the Company
made in China; (5) the Company engaged in undisclosed related-party
transactions in violation of Generally Accepted Accounting
Principles; and (6) the Company’s statements regarding its internal
financial controls were false and misleading.
On August 16, 2011, an anonymous research analyst
published a report detailing numerous problems with SinoTech’s
previously issued financial statements and future prospects.
On that day, the Company’s stock price dropped
more than 40%, falling from $4.02 per share on August 15, 2011 to
$2.35 per share at the close of trading on August 16, 2011 – a
decline of $1.67 per share on unusually high trading volume.
After the market closed on August 15, 2011, the NASDAQ halted
trading in SinoTech stock and announced that trading would remain
halted until the Company “fully satisfied NASDAQ’s request for
additional information.” To date, trading in the stock
remains halted.
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 eight 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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