Advanced Battery Technologies Inc (NASDAQ: ABAT) Investor Securities Class Action Lawsuit 04/01/2011

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Company Name(s): 
Advanced Battery Technologies
Case Name: 
Advanced Battery Technologies Shareholder Class Action 04/01/2011
Case Status: 
Settlement Approved
Affected Securities
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
Class Period Begin: 
Class Period End: 
Court of Filing: 
U. S. District Court for the Southern District of New York
Deadline To File for Lead: 
Date Settled: 
Settlement Amount: 
Deadline to Participate in Settlement: 

March 25, 2015 - The U.S. Court of Appeals for the Second Circuit ordered the judgment of the district court is affirmed.

May 19, 2014 - The court issued a final judgment of the settlement.

April 23, 2014 - The lead plaintiff filed an amended notice of appeal.

March 26, 2014 - Parties filed a stipulation withdrawing the appeal filed on August 19, 2013.

March 24, 2014 - The court approved the settlement, entered the orders approving the plan of allocation and the motion for attorneys’ fees and expenses.

November 26, 2013 - The court preliminarily approved the settlement.

August 19, 2013 - The lead plaintiff filed a notice of appeal.

July 18, 2013 - The court denied the lead plaintiff's motion for leave to file a second amended complaint.

April 25, 2013 - Parties filed a stipulation of settlement.

September 25, 2012 - The lead plaintiff filed a motion for leave to file a second amended complaint.

August 29, 2012 - The court denied the defendants motion to dismiss and granted the auditor defendants' motion to dismiss.

November 16, 2011 - The defendants filed a motion to dismiss.

September 29, 2011 - The lead plaintiff filed a corrected amended consolidated complaint on behalf of investors who purchased Advanced Battery Technologies Inc (NASDAQ: ABAT) common shares between May 15, 2007 and Mar 29, 2011. The lead plaintiff alleges that the defendants violated the Securities Exchange Act of 1934 by issuing false and misleading statements between May 15, 2007 and Mar 29, 2011.

September 9, 2011 - Lead plaintiff and lead counsel were appointed and cases were consolidated.

May 31, 2011 - Lead plaintiff motions were filed.

May 5, 2011 - Another investor filed an additional complaint.

April 6, 2011 - Another investor filed a complaint.

April 1, 2011 - An investor in shares of Advanced Battery Technologies Inc (NASDAQ: ABAT now trading on the OTC sheets as OTC: ABAT) filed a lawsuit in the U.S. District Court for the Southern District of New York against Advanced Battery Technologies Inc over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between March 16, 2009 and March 29, 2011.

According to the complaint the plaintiff alleges that on behalf of investors who purchased the common stock of Advanced Battery Technologies Inc (NASDAQ: ABAT) during the period from March 16, 2009 through March 29, 2011, that Advanced Battery Technologies Inc made a number of misrepresentations in its public filings with the Securities Exchange Commission and in its press releases.

Advanced Battery Technologies Inc reported an increase in its 12 months Total Revenue from $31.90 million in 2007 to $97.13 million in 2010. Its Net Income went from $10.21 million in 2007 to $36.73 million in 2010.

Shares of Advanced Battery Technologies Inc traded in 2006 as low as $0.50 per share and increased in 2007 to as high as $8.33 per share. During 2008 ABAT shares fell to $1.34 per share but increased in 2009 to $4.76 per share. During 2010 ABAT shares traded around $4 per share. During the first months in 2011 ABAT shares traded slightly under $4. Then on March 30, 2011 an equity research firm called Variant View Research (“Variant View”) published an article alerting investors to a number of potential red flags of fraud at Advanced Battery Technologies Inc. A Seeking Alpha article with the title: “Advanced Battery Technologies: An Egregious Chinese RTO” raised serious questions about Advanced Battery Technologies Inc.

Among other things the article raises the following questions:

“1. The Chairman appears to have transferred ownership of ABAT’s key subsidiary to himself without explanation or compensation;
2. ABAT leads investors to think that it makes cutting-edge electric cars, when in fact it produces cheap scooters and bicycles;
3. ABAT claims unrealistic margins in what it admits is a commodity space;
4. ABAT claims to have increased revenue from $4.2 million to $97.1 million from 2005 to 2010 while DECREASING its employee count;
5. ABAT claims distribution relationships which appear to be fake;
6. ABAT is a serial issuer of equity at low prices;
7. ABAT spent $20 million to acquire a company linked to the Chairman without disclosing the relationship;
8. ABAT spent $22 million or 7x sales to acquire a failing and possibly related company;
9. ABAT issued 11 million shares to the Chairman and other individuals to repay a “loan” which appears to be entirely fabricated;
10. Despite a parade of auditors and multiple restatements, ABAT still has material weaknesses;
11. ABAT’s RTO promoter, John Leo, is behind a number of suspicious Chinese reverse mergers, most notably CYXI;
12. No fundamental institutions are significant shareholders. “

According to the article the author believes “that the financial statements and management of ABAT cannot be trusted and therefore the stock is worth zero."

Following the report shares of Advanced Battery Technologies Inc (NASDAQ: ABAT) fell from $3.5 per share to under $2 during March 30, 2011.