Faruqi & Faruqi, LLP Files Class Action Lawsuit Against New Oriental Education & Technology Group, Inc. (EDU)
NEW YORK, Aug. 30, 2012 /PRNewswire/ -- Notice is hereby given that Faruqi & Faruqi, LLP has filed a class action lawsuit in the United States District Court for the Southern District of New York, Case No. 1:12-cv-6619-JGK, on behalf of all persons who purchased or otherwise acquired New Oriental Education & Technology Group, Inc. ("EDU" or the "Company") (NYSE: EDU) American Depository Shares ("ADSs") and/or purchased or sold EDU options contracts between July 21, 2009 and July 23, 2012, inclusive (the "Class Period") and suffered damages as a result.
If you wish to obtain information concerning this action or view a copy of the complaint, you can do so by clicking here: http://www.faruqilaw.com/EDU. There is no cost or obligation to you.
EDU and its executives are charged with violations of Section 10(b) and/or 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Specifically, the complaint alleges that defendants knew or recklessly failed to inform investors that: (1) the Company improperly consolidated the earnings of a variable interest entity into its financial statements; (2) a significant number of the Company's schools and learning centers were not company-owned, but were instead operated by independent franchisees; (3) upfront franchise and other fees had artificially inflated the Company's cash balances; and (4) the Company lacked adequate internal and financial controls and as a result of the foregoing, EDU's financial statements were materially false and misleading.
On July 17, 2012, the Company disclosed that the Securities and Exchange Commission "had issued a formal order of investigation" as to whether the Company appropriately consolidated the earnings of Beijing New Oriental Education & Technology (Group) Co., Ltd., a variable interest entity of the Company, and its wholly-owned subsidiaries. On this news, the price of EDU's ADSs plummeted by $7.64 or more than 34%, to close at $14.62 on July 17, 2012.
On July 18, 2012, independent securities research firm Muddy Waters, LLC issued an analyst report predicting that the Company "will have a significant restatement, and that its auditor will resign." On this news, the price of EDU's ADSs declined by an additional $5.12 or more than 35%, to close at $9.50 on July 18, 2012.
Plaintiff now seeks to recover damages on behalf of himself and all other individual and institutional investors who purchased or otherwise acquired EDU ADSs and/or purchased or sold EDU options contracts between July 21, 2009 and July 23, 2012, excluding defendants and their affiliates, and were damaged thereby. Plaintiff is represented by Faruqi & Faruqi, LLP, a law firm with extensive experience in prosecuting class actions and actions involving corporate fraud.
If you purchased or sold EDU option contracts and/or purchased or otherwise acquired EDU ADSs during the Class Period and were damaged thereby, you may, not later than September 21, 2012, move the court to serve as lead plaintiff of the class, if you so choose. In order to discuss this action, or if you have any questions concerning this notice or your rights or interests, please contact:
Faruqi & Faruqi, LLP
369 Lexington Avenue, 10th Floor
New York, NY 10017
ATTN: Richard Gonnello, Esq. or Francis P. McConville, Esq.
firstname.lastname@example.org or email@example.com
Toll Free: (877) 247-4292
Phone: (212) 983-9330
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