- Created on Friday, 22 May 2015 14:49
On April 29, 2015, Judge Edgardo Ramos of the U.S District Court for the Southern District of New York appointed the Law Offices of Curtis V. Trinko, LLP (“Trinko Firm”) lead counsel in Pehlivanian v. China Gerui Advanced Materials Group, Ltd., Case No. 1:14-cv-09443-ER, a putative class action brought on behalf of shareholders of China Gerui Advanced Materials Group Ltd. (“China Gerui”)(NASDAQ: CHOP).
The lawsuit alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as well as common law fraudulent concealment, that occurred when China Gerui, its directors, and/or officers issued materially false and misleading statements regarding China Gerui’s business and prospects.
Specifically, on September 4, 2014, China Gerui disclosed that, before June 30, 2014, it had purportedly spent $234 million of its unrestricted cash to acquire a collection of antique Chinese porcelain that it valued at $905 million. However, China Gerui provided no details regarding the collection’s source, where the collection was being stored, whether it is insured, and who appraised and authenticated it.
Before this unexpected purchase, China Gerui had emphasized its fiscal discipline, and had characterized its growth strategy as involving expanding its product lines, expanding overseas, and combining with competitors. China Gerui had also previously touted its significant cash reserves, reporting holdings of $230.7 million of unrestricted cash as of March 31, 2014. By contrast, on September 4, 2014, China Gerui disclosed that as of June 30, 2014, it had a mere $3 million in unrestricted cash.
A briefing schedule has been set regarding China Gerui and director defendant Harry Edelson’s anticipated motion to dismiss. The motion to dismiss is scheduled to be filed on May 29, 2015, and to be fully briefed by July 13, 2015.
If you have any questions regarding this case, please contact Curt Trinko at (212) 490-9550.