NetSol Technologies Inc (NASDAQ: NTWK) Investor Securities Class Action Lawsuit 07/25/2014

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Company Name(s): 
NetSol Technologies
Case Name: 
NetSol Technologies Shareholder Class Action Lawsuit 07/25/2014
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Approved
Affected Securities
NASDAQ: NTWK
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
07/25/2014
Class Period Begin: 
10/24/2013
Class Period End: 
11/08/2013
Court of Filing: 
U.S. District Court for the Central District of California
Deadline To File for Lead: 
09/23/2014
Date Settled: 
03/28/2016
Settlement Amount: 
$850,000
Deadline to Participate in Settlement: 
06/13/2016
Summary: 

May 5, 2017 - The court ordered the authorization of the distribution of the net settlement fund.

July 2, 2016 - The court approved the settlement.

March 28, 2016 - The court preliminarily approved the settlement.

February 26, 2016 - Parties filed a stipulation of settlement.

April 20, 2015 - Defendants filed a motion to dismiss.

March 31, 2015 - The lead plaintiff filed another amended consolidated complaint on behalf of investors who purchased NetSol Technologies Inc (NASDAQ: NTWK) common shares between May 10, 2011 and November 8, 2013. The lead plaintiff alleges that the defendants violated the Securities Exchange Act of 1934 by issuing false and misleading statements between May 10, 2011 and November 8, 2013.

March 19, 2015 - Defendants filed another motion to dismiss.

January 20, 2015 - Defendants filed a motion to dismiss.

December 19, 2014 - The lead plaintiff filed an amended consolidated complaint.

October 29, 2014 - The lead plaintiffs and lead counsel were appointed and all cases were consolidated.

September 23, 2014 - All cases were consolidated.

September 23, 2014 - Lead plaintiff motions were filed.

July 25, 2014 - An investor, who purchased shares of NetSol Technologies Inc (NASDAQ: NTWK), filed a lawsuit in the U.S. District Court for the Central District of California against NetSol Technologies Inc over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between November 12, 2009 and November 8, 2013.

According to the complaint the plaintiff charges NetSol Technologies Inc with violations of the Securities Exchange Act of 1934. The complaint alleges that between November 12, 2009 and November 8, 2013 defendants issued materially false and misleading statements regarding NetSol Technologies Inc's business and financial results.

More specifically, the plaintiff claims that on March 10, 2011 defendants issued allegedly materially false and misleading statements because NetSol Technologies Inc's next generation product was not expected to be completed when promised by NetSol Technologies Inc, because serious interest in NetSol Technologies Inc's next generation solution had not been expressed by a few global companies, because NetSol Technologies Inc was not experiencing a growing interest in its next generation NFS product and the product was not ready for testing at customer sites, because NetSol Technologies Inc did not expect future growth through increased revenues from both the current version and the next generation of NFS, because there was no reasonable basis for stating that development of the next generation of NFS would change the landscape for NetSol Technologies Inc and increase both demand and the market, because NetSol Technologies Inc did not have a reasonable basis for stating that its target customers who were still using old systems for maintaining their lease and finance portfolios were planning to replace their legacy systems or that NetSol Technologies Inc was in a good position to tap new business from these companies, and because all internal data pointed to a continued business decline; not "growth and strength across the business" as represented by NetSol Technologies Inc.

On October 2, 2013, a report was published that questioned the accuracy of NetSol Technologies Inc's financial disclosures. Specifically, the article asserts NetSol Technologies Inc’s earnings are illusory as a result of misleading accounting treatments. In addition, the article claimed that NetSol Technologies Inc’s purportedly independent auditor may have connections to NetSol Technologies Inc’s CEO. On October 3, 2013, NetSol Technologies Inc issued a statement in response to the article. Shares of NetSol Technologies Inc (NASDAQ:NTWK) declined from $10.44 per share on October 2, 2013, to $8.11 per share on October 3, 2013.

Then on November 8, 2013, NetSol Technologies Inc reported its Fiscal 2014 First Quarter Results. NetSol Technologies Inc (NASDAQ: NTWK) shares declined from $7.60 per share on November 7, 2013, to $5.11 per share on November 12, 2013.