Intelligent Systems Corporation
Bernstein Liebhard LLP, a nationally acclaimed investor rights law firm, announces that a securities class action lawsuit has been filed on behalf of shareholders that acquired shares of Intelligent Systems Corporation, (“INS” or the “Company”) (NYSE: INS) between January 23, 2019, and May 29, 2019, inclusive.
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New York, New York—Bernstein Liebhard LLP, a nationally acclaimed investor rights law firm, announces that a securities class action lawsuit has been filed on behalf of shareholders that acquired shares of Intelligent Systems Corporation (“INS” or the “Company”) (NYSE: INS) between January 23, 2019, and May 29, 2019, inclusive (the “Class Period”). The lawsuit was filed in the United States District Court for the Eastern District of New York and seeks to recover damages for INS investors under the Securities Exchange Act of 1934. If you wish to serve as lead plaintiff, you must move the court no later than September 9, 2019. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Your ability to share in any recovery doesn’t require that you serve as lead plaintiff. If you take no action, you may remain an absent class member.
According to the lawsuit, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors:(1) Defendant Petit, the “financial expert” on Intelligent Systems’ Audit Committee engaged in accounting fraud as the CEO of MiMedx Group, Inc.; (2) Intelligent Systems’ CEO, Defendant Strange, engaged in undisclosed related-party transactions with Defendant Petit and others and had an undisclosed personal relationship with the Company’s auditor; (3) Intelligent Systems had its employees set up or take control of shell companies in Asia so they could partake in undisclosed related-party transactions for the purpose of either fabricating revenue for the Company and/or siphoning money out of the Company; and (4) as a result, defendants’ statements about Intelligent Systems’ business, operations, and prospects were materially false and/or misleading and/or lacked a reasonable basis at all relevant times.
On May 24, 2019, before market hours, Aurelius Value published a report “INS: A Wolf in Pete’s Clothing.” The report discussed MiMedx Group’s disclosures concerning Defendant Petit and also accused the Company’s CEO, Defendant Strange, inter alia, of engaged in undisclosed related-party transactions with Defendant Petit and others and of an undisclosed personal relationship with INS’s auditor, Nicolas Cauley.
On this news, shares of INS fell $4.18 per share, or more than 10% to close at $34.93 per share on May 24, 2019, damaging investors.
On May 30, 2019, before the market opened, Grizzly Research LLC issued a report entitled “Intelligent Systems Corp: Material Undisclosed Related Party Transactions Cast Doubt on the Integrity of Financial Statements.” The report presented evidence that “Intelligent Systems Corp. (INS) has its employees set up or take control of undisclosed shell companies in Asia, who then partake in undisclosed related party transactions with INS intended to either round-trip revenue back to INS or siphon money out of the company.” It further stated that “there is a possibility that all revenue growth since January 2018 has been a result of undisclosed round-trip transactions with Indian related parties.”
On this news, shares of INS fell $6.82 from the prior day’s closing price of $33.81 or over 20%, to close at $26.99 per share on May 30, 2019.
Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the Firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the Firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” thirteen times and listed in The Legal 500 for ten consecutive years.
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Matthew E. Guarnero
Bernstein Liebhard LLP