Bernstein Liebhard LLP Announces Filing of a Class Action Against JBI, Inc.
August 15, 2011
Bernstein Liebhard LLP today announced that a lawsuit has been filed in the United States District Court for the District of Nevada on behalf of a class (the “Class”) of investors who purchased JBI, Inc. (“JBI” or the “Company”) (OTC: JBII) securities between the period of August 28, 2009 and July 20, 2011 (the “Class Period”).
The Complaint charges JBI and certain of the Company’s current and former executive officers with violations of federal securities laws. JBI purports to be a domestic alternative oil and gas company. In 2009, the Company acquired JavaCo, Inc. (“JavaCo”) from Domark International, Inc. (“Domark”) and also issued 1 million shares of JBI to Domark in exchange for media credits valued at $9,997,134. The Complaint alleges that throughout the Class Period defendants knew or recklessly disregarded that their public statements concerning JBI’s business, operations and prospects were materially false and misleading. Specifically, the defendants made false and/or misleading statements and/or failed to disclose: (1) that the media credits acquired by the Company in connection with the acquisition of JavaCo were substantially overvalued; (2) that the Company was improperly accounting for acquisitions; (3) that, as such, the Company’s financial results were not prepared in accordance with Generally Accepted Accounting Principles (“GAAP”); (4) that the Company lacked adequate internal and financial controls; and (5) that, as a result of the above, the Company’s financial statements were materially false and misleading at all relevant times.
On May 21, 2010, JBI disclosed that its previously issued financial statements for the 2009 fiscal year and third quarter should no longer be relied upon due to the accounting treatment and related disclosures of two acquisitions completed in 2009, and the valuation of media credits acquired by JBI through the issuance of common stock. On this news, shares of JBI declined $0.65 per share, more than 21%, to close on May 21, 2010, at $2.40 per share, on heavy volume, and further declined $0.80 per share, more than 33%, to close on May 24, 2010, at $1.60 per share, also on heavy volume.
On July 20, 2011, JBI disclosed that the staff of the United States Securities and Exchange Commission’s (“SEC”) Division of Enforcement issued a “Wells Notice” to JBI indicating that the staff intended to recommend that the SEC file a civil lawsuit alleging that the Company violated certain provisions of the federal securities laws. JBI indicated its belief that the proposed lawsuit related to the Company’s restated financial statements for the 2009 fiscal year and third quarter, and that the SEC staff may also recommend naming one or more current and former officers of JBI as defendants. On this news, shares of JBI declined $0.62 per share, nearly 24%, to close on July 21, 2011, at $2.00 per share, on unusually heavy volume.
Plaintiffs seek to recover damages on behalf of all Class members who purchased or otherwise acquired shares of JBI during the Class Period. If you purchased or otherwise acquired JBI shares during the Class Period, and either lost money on the transaction or still hold the shares, you may wish to join in this action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than September 26, 2011.
A “lead plaintiff” is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiff. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Bernstein Liebhard LLP, or other counsel of your choice, to serve as your counsel in this action.
If you are interested in discussing your rights as a JBI shareholder and/or have information relating to the matter, please contact Joseph R. Seidman, Jr. at (877) 779-1414 or firstname.lastname@example.org.
Bernstein Liebhard has pursued hundreds of securities, consumer, and antitrust cases and recovered almost $3 billion for itsclients. It has been named to The National Law Journal’s “Plaintiffs’ Hot List” in each of the last eight years.