NEW YORK, May 13, 2011 (GLOBE NEWSWIRE) -- Shareholders of Puda Coal, Inc. ("Puda" or the "Company") (AMEX:PUDA) are reminded of the securities class action lawsuit filed against Puda and certain of its officers. The class action (No. 11 Civ. 2609) pending in the United States District Court for the Southern District of New York is on behalf of a class of purchasers of PUDA securities between November 13, 2009 and April 11, 2011 (the "Class Period"). The Complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.
If you are a shareholder who purchased PUDA securities during the Class Period and would like to serve as lead plaintiff for the class, you have until June 13, 2011 to ask the Court to appoint you. A copy of the complaint can be obtained at . To discuss this action, contact Rachelle R. Boyle at rrboyle@pomlaw.com or 888.476.6529 toll free. Those who inquire by e-mail are encouraged to include their mailing address and telephone number.
Puda, through its sole operating subsidiary Shanxi Puda Coal Group Co., Ltd. ("SPCG"), supplies metallurgical coking coal to the industrial sector in the People's Republic of China. The Complaint alleges that throughout the Class Period, Defendants misrepresented and/or failed to disclose, among other things: (1) that the Company's Chairman, Ming Zhao ("Zhao"), had transferred ownership/shares of SPCG to himself through a series of transactions; (2) that Zhao had sold 49% of SPCG; (3) that, as a result, Puda did not possess the ownership interests in SPCG that the Company claimed to possess; (4) that the Company lacked adequate internal and financial controls; and (5) that, as a result of the foregoing, the Company's statements were materially false and misleading at all relevant times.
On March 16, 2011, an investor website published a research report alleging that through a series of transactions beginning in September 2009, Zhao improperly transferred SPCG to himself; in July 2010 sold 49% of the interest in SPCG for RMB245 million ($37.1 million), and later pledged the remaining 51% interest in the SPCG as collateral for a three year loan for RMB 2.5 billion ($379 million).
On April 8, 2011, a report on an investment website alleged that Puda failed to disclose certain Company transfers and questionable trading by Zhao. On April 11, 2011, the Company's Audit Committee announced that "evidence supports the allegation that there were transfers by Mr. Zhao in subsidiary ownership that were inconsistent with disclosure made by the Company in its public securities filings."
As a result of this news, the Company's shares declined $3.10 per share, or 34%, to close on April 8, 2011, at $6.00 per share, on unusually heavy trading volume. Trading of the Company's shares was subsequently halted.
The Pomerantz Firm, with offices in New York, Chicago and Washington, D.C., is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members.
CONTACT: Rachelle R. Boyle Pomerantz Haudek Grossman & Gross LLP 888-476-6529 (ext. 237) rrboyle@pomlaw.com