Assisted Living Concepts, Inc. (NYSE:ALC) Investor Files Securities Class Action Lawsuit Over Alleged False and Misleading Statements
Aug. 29, 2012 (Shareholders Foundation) -- An investor in shares of Assisted Living Concepts, Inc. (NYSE:ALC) filed a lawsuit in the U.S. District Court for the Eastern District of Wisconsin against Assisted Living Concepts, Inc. over alleged violations of Federal securities laws in connection with certain allegedly false and misleading statements.
According to the complaint the plaintiff alleges on behalf of investors who purchased Assisted Living Concepts, Inc. (NYSE:ALC) Class A common stock during the period between March 12, 2011 and August 6, 2012, that Assisted Living Concepts, Inc. and its former Chief Executive Officer violated the Securities Exchange Act of 1934 by issuing allegedly materially false and misleading statements, and omitting allegedly material information its compliance with its obligations under a lease covering eight assisted living facilities operated by Assisted Living Concepts, Inc.
The plaintiff says that Under the terms of the lease, Assisted Living Concepts, Inc.was obligated to maintain specified occupancy rates and insure all regulatory licenses remained in good standing and in its quarterly and annual United States Securities and Exchange Commission ( “SEC”) filings, Assisted Living Concepts, Inc. confirmed its compliance with these obligations.
However, on May 4, 2012 Assisted Living Concepts, Inc said in a statement that on May 3, 2012 its Board of Directors determined to investigate possible irregularities in connection with the Company’s lease with Ventas Realty, Limited Partnership, the landlord for eight assisted living facilities operated by Assisted Living Concepts, and retained counsel for such purpose.
On August 7, 2012, Assisted Living Concepts, Inc said that on August 2, 2012, it was informed by SEC that the SEC staff is conducting an investigation relating to the Company and as part of this investigation, the SEC issued a subpoena to the Company.
Assisted Living Concepts, Inc said that the subpoena requires the Company to produce documents on a number of topics, including, among others, compliance with occupancy covenants in the now-superseded lease with Ventas Realty, Limited Partnership and leasing of units for employee use.
NYSE:ALC shares fell from over $19 on May 3, 2012 to as low as $16.26 per share on May 4, 2012at $16.80 per share and dropped from $14.05 per share on August 2, 2012, to as low as $7.01 per share on August 13, 2012.
On August 29, 2012, NYSE:ALC shares closed at $7.93 per share, significantly below its current 52 week High of $20.33 per share.