A lawsuit seeking class action status has been filed on behalf of all persons who purchased the common stock of ArthroCare Corporation ("ArthroCare'' or the "Company'') (NasdaqGS:ARTC - News) between August 4, 2006 and January 23, 2008, inclusive (the "Class Period''). The action is pending in the United States District Court for the Southern District of Florida at docket number 9;08-cv-80343.
The Complaint alleges, inter alia, that ArthroCare and certain of its officers violated the federal securities laws by issuing materially false and misleading statements concerning the Company's business and financial results during the Class Period. Specifically, the Complaint alleges that ArthroCare's reported financial results were materially false, misleading and overstated as a result of (i) ArthroCare's improper recognition of revenue from transactions with DiscoCare, Inc. ("DiscoCare''), which were contingent in nature; and (ii) ArthroCare's improper recognition of revenue from transactions with Device Reimbursement Services ("DRS''), an undisclosed, related party.
The Complaint further alleges that these material misrepresentations artificially inflated the price of ArthroCare stock, causing the price of ArthroCare to trade as high as $64.84 per share during the Class Period. As a result of adverse news stories and partial disclosures concerning the accuracy of the Company's reported financial results and its business dealings with DiscoCare and DRS, the price of the Company's stock fell to approximately $38.11 by January 25, 2008. The Complaint alleges that Defendants' conduct constitutes violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
If you purchased ArthroCare common stock during the Class Period, you may, no later than June 3, 2008, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members.
ArthroCare Articles
ArthroCare Securities: Dealings Lead to Potential LawsuitThere is nothing more complicated than the various dealings of a major corporation, the results of which can leave your head spinning. However, the announcement of a class-action lawsuit against ArthroCare Corporation alleging securities fraud appears to suggest that such complexities, and the motivation behind them, can hit investors in the pocketbook.
