The lawsuit focuses on whether the Company and its executives violated federal securities laws by failing to maintain proper accounting which resulted in misguiding financial statements.
First, on September 10, 2015, Street Sweeper published the article, "Fenix Parts: This Automobile Parts Seller Could Be Headed To The Junkyard" revealing the Company's lack of adequate inventory valuation methodologies. After the announcement, Fenix's share price fell from $9.59 per share on September 9, 2015 to a closing price of $8.47 on September 10, 2015—a $1.12 or a 11.7% drop.
Then, on October 13, 2016, the Company issued a press release announcing that it would be unable to file its quarterly report for the second quarter of 2016 and that it had received a subpoena from the Securities and Exchange Commission. The subpoena is focused on the Company's recent change in its independent registered public accounting firm, its previously announced business combinations and related goodwill impairment charge, the effectiveness of its internal control over financial reporting and its inventory valuation methodology. After the announcement, Fenix's share price fell from $3.87 per share on October 12, 2016 to a closing price of $3.42 on October 13, 2016 —a $0.45 or a 11.63% drop.
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If you invested in Fenix stock or options between May 14, 2015 and October 12, 2016 and would like to discuss your legal rights, visit www.faruqilaw.com/FENX. You can also contact us by calling Richard Gonnello toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to firstname.lastname@example.org. Faruqi & Faruqi, LLP also encourages anyone with information regarding Fenix's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class that is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision of whether or not to serve as a lead plaintiff.
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FARUQI & FARUQI, LLP
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Attn: Richard Gonnello, Esq.
Telephone: (877) 247-4292 or (212) 983-9330
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SOURCE Faruqi & Faruqi, LLP