WAYNE, Pa., Jan. 23, 2015 /PRNewswire/ -- Ryan & Maniskas, LLP announces that a class action lawsuit has been filed in United States District Court for the Central District of California on behalf of all persons or entities that purchased the common stock of Medbox, Inc. ("Medbox" or the "Company") (OTC: MDBX) between November 20, 2013 and December 29, 2014, inclusive (the "Class Period").
Medbox shareholders may, no later than March 23, 2015, move the Court for appointment as a lead plaintiff of the Class. If you purchased shares of Medbox and would like to learn more about these claims or if you wish to discuss these matters and have any questions concerning this announcement or your rights, contact Richard A. Maniskas, Esquire toll-free at (877) 316-3218 or to sign up online, visit: www.rmclasslaw.com/cases/mdbx.
Medbox, through its subsidiary Medicine Dispensing Systems, sells its patented vending machines that dispense medical marijuana, software and consulting services to pharmacies, alternative medicine dispensaries and local governments in the United States. The Complaint alleges that throughout the Class Period, defendants made materially false and misleading statements, and omitted materially adverse facts, about the Company's business, operations and prospects. Specifically, the Complaint alleges that the defendants failed to disclose the following: (1) Medbox was recognizing revenue before earned on certain customer contracts; (2) Medbox lacked effective internal controls; (3) due to its false financial reporting, Medbox was not complying with Generally Accepted Accounting Principles or SEC rules and regulations during the Class Period and, as such, was not eligible for listing on a national exchange; (4) due to its financial misstatements, Medbox was not in compliance with its debt covenants; and (5) as a result, Medbox was not on track to achieve its financial targets during the Class Period. As a result of defendants' alleged false and misleading statements, the Company's stock traded at artificially inflated prices during the Class Period.
According to the Complaint, on December 30, 2014, before the opening of trading, Medbox issued a press release disclosing that it would be forced to restate the past five quarters of financial reports and potentially its "financial statements for 2012 and for the first two quarter of 2013 . . . as well." The Company further disclosed that the earnings restatement had triggered a default on its debt covenants that had forced it to seek a forbearance from lenders. The release stated that the "steps [being taken were] part of the continued initiative of [Medbox's] new board of directors and new management team to implement better controls and emphasize transparency."
On this news, shares in Medbox fell almost 13%, closing at $5.58 per share on December 31, 2014, on high trading volume.
If you are a member of the class, you may, no later than March 23, 2015, request that the Court appoint you as lead plaintiff of the class. 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 Ryan & Maniskas, LLP or other counsel of your choice, to serve as your counsel in this action.
Ryan & Maniskas, LLP is a national shareholder litigation firm. Ryan & Maniskas, LLP is devoted to protecting the interests of individual and institutional investors in shareholder actions in state and federal courts nationwide.