Universal Travel Group (NYSE: UTA) Investor Securities Class Action Lawsuit 04/15/2011

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Company Name(s): 
Universal Travel Group
Case Name: 
Universal Travel Group Shareholder Class Action Lawsuit 04/15/2011
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Proposed
Affected Securities
NYSE: UTA
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
04/15/2011
Class Period Begin: 
03/12/2009
Class Period End: 
04/11/2011
Court of Filing: 
U.S. District Court for the District of New Jersey
Deadline To File for Lead: 
06/15/2011
Date Settled: 
12/29/2016
Settlement Amount: 
$4,075,000
Deadline to Participate in Settlement: 
03/18/2017
Summary: 

December 29, 2016 - The court preliminarily approved the settlement.

July 1, 2016 - Parties filed a stipulation of settlement.

November 25, 2015 - Defendants filed a motion to dismiss.

November 11, 2015 - The lead plaintiff filed a third amended complaint.

July 23, 2014 - The court issued an order staying the case.

June 27, 2014 - Defendants filed a motion to dismiss.

May 1, 2014 - The lead plaintiff filed a second amended complaint.

October 22, 2012 - Defendants filed a motion to dismiss.

September 7, 2012 - Lead plaintiff filed an amended complaint on behalf of investors who purchased Universal Travel Group (NYSE: UTA) common shares between March 12, 2009 to April 11, 2011. The lead plaintiff alleges that the defendants violated the Securities Exchange Act of 1934 by issuing false and misleading statements between March 12, 2009 to April 11, 2011.

July 19, 2012 - Lead plaintiff and lead counsel were appointed.

June 22, 2012 - Additional lead plaintiff motions were filed.

June 15, 2011 - Lead plaintiff motions were filed.

April 15, 2011 - An investor in shares of Universal Travel Group (NYSE: UTA now trading on the OTC sheets as UTRA) filed a lawsuit in the U.S. District Court of New Jersey against Universal Travel Group over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between January 19, 2010 to April 12, 2011.

Universal Travel Group’s 12 month Total Revenue surged from $10.01 million in 2006 to $97.88 million in 2009. Its Net Income increased from $2.56 million in 2006 to $11.34 million in 2009. For the first three quarters in 2010, Universal Travel Group reported a combined nine months Total Revenue that succeeded its 12 months Total Revenue from 2009. Universal Travel Group reported a combined nine months Total Revenue for 2010 of $109.16 million. Universal Travel Group reported also a nine months Net Income for 2010 that succeeded its 12 months Total Revenue. For the first three quarters in 2010 Universal Travel Group reported a combined nine months Net Income of $17.40 million.

Shares of Universal Travel Group (NYSE: UTA) fell from as high as $13.91 per share in November 2009 to $3.77 per share in September 2010. Then UTA shares regained value to $7.67 per share in February 2011.

On March 8, 2011 a firm called Glaucus Research Group issued a report (setting forth numerous red flags of fraud, ranging from alleged misstatements concerning Universal Travel Group’s online travel business, cash balances, and Universal Travel Group’s purported relationship with a large on-line travel company. The Glaucus Research Group Report also revealed that the financial statements of the companies Universal Travel Group acquired in 2010 that were filed with authorities in China showed only a fraction of the revenue, asset value and income, contrary to the statements Universal Travel Group made to investors about the acquired companies.

On March 29, 2011 Universal Travel Group announced that it would postpone its earnings announcement for the fiscal year ended December 31, 2010. Then on April 12, 2011 trading in Universal Travel Group’s stock was halted.

On April 14, 2011, Universal Travel Group filed an 8-K with the SEC announcing that its auditor Windes & McClaughry Accountancy Corporation had resigned. According to the 8-K, the auditors believed that Universal Travel Group and/or its Audit Committee was “being non-responsive, unwilling or reluctant to proceed in good faith and imposing scope limitations on [the auditors’] audit procedures.” The auditors also noted that they “had lost confidence in the Board of Directors’ and the Audit Committee commitment to sound corporate governance and reliable financial reporting.”

Shares of Universal Travel Group (NYSE: UTA) fell to under $4 per share on April 11, 2011.