| Company: | Verdisys, Inc. |
| Ticker Symbol: | OTC Pink Sheets: VDYS |
| Class Period: | August 20, 2003 to March 9, 2004 |
| Court: | Southern District, TX |
| Date Filed: | Mar-31-04 |
| Lead Plaintiff Deadline: | Jun-01-04 |
| Allegations: |
A class action lawsuit has been
filed in the United States District Court for the Southern District of Texas,
Houston Division, on behalf of purchasers of Verdisys, Inc.
(OTC Pink Sheets: VDYS; formerly Nasdaq: VDYS) ("Verdisys" or the "Company")
publicly traded securities during the period between August 20, 2003 and
March 9, 2004, inclusive (the "Class Period").
The complaint charges Verdisys and its former Chief Executive Officer, Dan Williams, and the Company's former Chief Financial Officer, Andrew Wilson, with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The Complaint alleges that defendants made materially misstatements with respect to the Company's financial results. More specifically, the Complaint alleges that defendants failed to disclose and indicate: (1) that the Company had materially overstated its net income and earnings per share; (2) that defendants prematurely recognized revenue from contracts between the Company, Edge Capital Group, Inc. and Energy 2000 in violation of GAAP and its own revenue recognition policy; (3) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (4) that as result of recognizing revenue prematurely, the Company's financial results were inflated at all relevant times.
On March 10, 2004, the United States Securities and Exchange Commission ("SEC") announced the temporary suspension of trading of the securities of Verdisys at 9:30 a.m. on March 10, 2004, and terminating at 11:59 p.m. on March 23, 2004. The SEC further stated that temporarily suspending trading in the securities of Verdisys was because of questions that had been raised about the accuracy and adequacy of publicly disseminated information, including assertions made in Commission filings, concerning, among other things, the company's business operations related to its lateral drilling services and the company's anticipated and actual revenues.
On March 15, 2004, the Company announced that it was conducting an ongoing internal investigation that began in December 2003 into the Company's activities in the second and third quarters of 2003. The Company had thus far been unable to determine whether certain radial drilling services were actually provided to two of Verdisys' customers, Edge Capital Group, Inc. and Energy 2000 NGC, Inc. in the Monroe field in Louisiana. Accordingly, the Company expected to restate its interim 2003 financial statements to reverse $230,000 of revenue in the quarter ended June 30, 2003, and $605,000 of revenue in the quarter ended September 30, 2003, until such a time that it could confirm such services were performed.
When shares of Verdisys resumed trading on March 24, 2004, they plummeted $2.10 per share, or 35.9%, on unusually high volume to close at $3.75 per share.
If you feel you qualify for damages or remedies that might be awarded in this class action please fill in our form on the right to submit your complaint.
If your injustice does not match the complaint described above, please use this form to register your complaint. Thank you.
The complaint charges Verdisys and its former Chief Executive Officer, Dan Williams, and the Company's former Chief Financial Officer, Andrew Wilson, with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The Complaint alleges that defendants made materially misstatements with respect to the Company's financial results. More specifically, the Complaint alleges that defendants failed to disclose and indicate: (1) that the Company had materially overstated its net income and earnings per share; (2) that defendants prematurely recognized revenue from contracts between the Company, Edge Capital Group, Inc. and Energy 2000 in violation of GAAP and its own revenue recognition policy; (3) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (4) that as result of recognizing revenue prematurely, the Company's financial results were inflated at all relevant times.
On March 10, 2004, the United States Securities and Exchange Commission ("SEC") announced the temporary suspension of trading of the securities of Verdisys at 9:30 a.m. on March 10, 2004, and terminating at 11:59 p.m. on March 23, 2004. The SEC further stated that temporarily suspending trading in the securities of Verdisys was because of questions that had been raised about the accuracy and adequacy of publicly disseminated information, including assertions made in Commission filings, concerning, among other things, the company's business operations related to its lateral drilling services and the company's anticipated and actual revenues.
On March 15, 2004, the Company announced that it was conducting an ongoing internal investigation that began in December 2003 into the Company's activities in the second and third quarters of 2003. The Company had thus far been unable to determine whether certain radial drilling services were actually provided to two of Verdisys' customers, Edge Capital Group, Inc. and Energy 2000 NGC, Inc. in the Monroe field in Louisiana. Accordingly, the Company expected to restate its interim 2003 financial statements to reverse $230,000 of revenue in the quarter ended June 30, 2003, and $605,000 of revenue in the quarter ended September 30, 2003, until such a time that it could confirm such services were performed.
When shares of Verdisys resumed trading on March 24, 2004, they plummeted $2.10 per share, or 35.9%, on unusually high volume to close at $3.75 per share.
If you feel you qualify for damages or remedies that might be awarded in this class action please fill in our form on the right to submit your complaint.
If your injustice does not match the complaint described above, please use this form to register your complaint. Thank you.
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