SAN DIEGO and GLEN ALLEN, Va., April 2, 2013 /PRNewswire/ -- Shareholder rights attorneys at Robbins Arroyo LLP announce that a purchaser of Star Scientific, Inc. (NASDAQ: STSI) securities has filed a complaint in the U.S. District Court for the Eastern District of Virginia. The complaint alleges that Star Scientific and certain of its officers and directors violated the Securities Exchange Act of 1934 between October 31, 2011 and March 18, 2013 (the "Class Period").
Star Scientific Accused of Making False and Misleading Statements Concerning the Company's Business, Operational, and Compliance Policies
The complaint alleges that the Star Scientific, a drug manufacturing company that produces products to promote a healthy lifestyle, such as dietary supplements, issued a series of materially false and misleading statements to investors regarding the company's business, operational, and compliance policies. Specifically, the complaint alleges that certain officers and directors delayed disclosure of the fact that the company had received subpoenas from the U.S. Attorney's office investigating potential securities fraud in Star Scientific's securities involving transactions dating back to 2006.
Star Scientific Price Drops Multiple Times: Concerned Shareholder Respond with Lawsuit
Further, Star Scientific, through its subsidiary Rock Creek, issued multiple press releases from 2011 through 2013, which led investors to believe that researchers at Johns Hopkins University had an active role in the clinical testing of its retail nutritional supplement anatabine. However, on January 23, 2013, The Street published an article alleging that the company misled investors regarding the role of John Hopkins University in the clinical testing of anatabine. The article quoted Johns Hopkins school of Medicine spokesperson Stephanie Desmon as stating, "The … clinical study was not conducted at or approved by Johns Hopkins." On this news, Star Scientific's stock declined $0.31 per share or nearly 12%, to close at $2.33 per share on January 23, 2013.
Moreover, in January and February 2013, Star Scientific received subpoenas from the U.S. Attorney's office for the Eastern District of Virginia concerning an investigation into whether the company engaged in potentially illegal transactions involving certain private placements and related party transactions since 2006. Star Scientific failed to disclose this investigation to investors until March 18, 2013, at which time the company announced it was conducting an internal investigation. As a result, Star Scientific shares declined a further $0.35 per share or 18% to $1.63 on March 19, 2013.
If you purchased or otherwise acquired Star Scientific stock during the Class Period and wish to serve as lead plaintiff, you must act no later than May 24, 2013. To discuss your shareholder rights, please contact attorney Darnell R. Donahue at (800) 350-6003, firstname.lastname@example.org, or via the shareholder information form on the firm's website.
Robbins Arroyo LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested. For more information, please go to http://www.robbinsarroyo.com.
Press release link: http://www.robbinsarroyo.com/shareholders-rights-blog/star-scientific-inc/
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SOURCE Robbins Arroyo LLP