NEW YORK, Dec. 6 (GenomeWeb News) - A class action suit has accused Ciphergen Biosystems and certain of its officers and directors of misleading shareholders regarding its second quarter results, according to lawyers who filed the suit.
News of the suit, disclosed in a statement yesterday after the markets closed, caused the company's stock price to drop 9 percent to $1.08 during early-morning trading today.
The suit, filed in the United States District Court for the Northern District of California by the law firm of Kaplan Fox & Kilsheimer, alleges Ciphergen issued a series of "false and misleading statements" regarding its financial condition between Aug. 8 and Nov. 16.
As previously reported in GenomeWeb News , Ciphergen disclosed on Nov. 16 that an internal audit committee had determined that the company's second-quarter results need to be restated and could not be trusted.
The restatement would reduce the quarter's reported revenue by 7 percent, or $503,000, and increase reported net loss by 3 percent, or $301,000, Ciphergen said at the time.
The suit claims that Ciphergen's original second-quarter financial results, which reported a 10-percent slide in revenue and a 30-percent increase in losses, artificially inflated share prices, and that when the company publicized its audit committee's findings, the stock plummeted 21percent, from $1.73 to $1.36 per share.
Investors who purchased Ciphergen' stock between Aug. 8 and Nov. 16 are covered under the class-action status.
Ciphergen did not immediately return a telephone call seeking comment.