19 Apr, 2012, 07:00 ET
NEW YORK, April 19, 2012 /PRNewswire/ -- Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential securities fraud at Delta Petroleum, Inc. ("Delta" or the "Company") (OTC: DPTRQ.PK).
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The investigation focuses on whether the Company and its executives violated federal securities laws by failing to disclose that: (1) the Company was not adequately reserving for dry hole costs and impairments in violation of Generally Accepted Accounting Principles, which materially overstated its financial results; (2) Delta's inefficient assets prevented the Company from finding a suitable buyer as the Company's aggregate debt was greater in value than its assets; and (3) the Company suffered from serious liquidity problems.
On November 9, 2011, Delta reported a net loss of $429.4 million for the third quarter ended September 30, 2011, largely due to costs associated with drilling dry holes. The Company provided an update on its strategic alternatives process, advising that Delta had not received any buyout offers and as a result, Delta would be forced to restructure its indebtedness. Delta further warned investors that, should it be unsuccessful in achieving a transaction or transactions addressing the Company's liquidity, it would be forced to seek protection under Chapter 11 of the U.S. Bankruptcy Code. On this news, Delta stock plummeted $1.34 per share to close at $0.71 per share on November 10, 2011, a decline of 65%.
On December 16, 2011, Delta announced that it had filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code.
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If you purchased Delta Petroleum securities between November 9, 2010 and November 9, 2011 and would like to discuss your legal rights, visit www.faruqilaw.com/DPTRQ. You can also contact us by calling Richard Gonnello or Francis McConville toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to [email protected] or [email protected]. Faruqi & Faruqi, LLP also encourages anyone with information regarding Delta's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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FARUQI & FARUQI, LLP
369 Lexington Avenue, 10th Floor
New York, NY 10017
Attn: Richard Gonnello, Esq.
Francis McConville, Esq.
Telephone: (877) 247-4292 or (212) 983-9330
SOURCE Faruqi & Faruqi, LLP
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