Newman Ferrara LLP announced today that it filed a class action lawsuit in the United States District Court for the Southern District of New York (Hughes v. KIT digital Inc., et al., 12-cv-9210) on behalf of purchasers of the common stock of KIT digital, Inc. (“KIT”) (Nasdaq) (“KITD”) for violations of federal securities laws.
Investors who purchased KIT securities between May 19, 2009 and November 21, 2012 (the “Class Period”) may apply with the Court to be appointed Lead Plaintiff no later than January 29, 2013. The Lead Plaintiff will direct the litigation on behalf of the other class members. The Court will select the Lead Plaintiff from among applicants claiming the largest investment losses.
The Complaint alleges that KIT and certain of its officers issued false and/or misleading statements and/or failed to disclose that: (1) there were irregularities with KIT’s accounting relating to improper revenue recognition for certain license agreements; (2) KIT’s financial statements were not prepared in accordance with Generally Accepted Accounting Principles; (3) KIT’s internal controls were deficient and incapable of producing adequate financial reporting; and (4) as a result of the above, KIT’s financial statements were materially false and misleading at all relevant times.
On November 21, 2012, KIT announced that, because of revenue being improperly recognized in its financial statements, KIT needed to restate its financial statements for each of the first three quarters and full years in 2009, 2010 and 2011 and for the first two quarters of 2012. On this news, shares of KIT stock plummeted 64% in value to a November 23, 2012 price of $0.74 per share and dropped another 16% on the following trading day to $0.62 per share.
Investors who purchased shares of KIT stock during the Class Period and lost more than $100,000 are encouraged to contact Newman Ferrara attorney Roy Shimon at firstname.lastname@example.org or call (212) 619-5400 to discuss this lawsuit or the Lead Plaintiff process.
Newman Ferrara maintains a multifaceted practice based in New York City with attorneys specializing in complex commercial and multi-party litigation, securities fraud and shareholder litigation, consumer protection, civil rights, and real estate. For more information, please visit the firm website at www.nfllp.com.