CHICAGO, April 16, 2012 /PRNewswire/ -- Hagens Berman Sobol Shapiro, an investor-rights law firm, today announced that it has filed a securities class-action lawsuit against Groupon (NASDAQ GS: GRPN) on behalf of investors.
The complaint, filed April 16, 2012, in the United States District Court for the Northern District of Illinois, alleges that Groupon, certain of its officers, directors and underwriters of Groupon's Initial Public Offering (IPO) violated the federal securities laws by issuing false and misleading statements to investors.
Investors who purchased or otherwise acquired shares of Groupon common stock between November 4, 2011, and March 30, 2012 (the "Class Period"), and who have suffered substantial financial losses are encouraged to contact Hagens Berman Partner Reed Kathrein by calling (510) 725-3000. Investors may also contact the firm via email at GRPN@hbsslaw.com or by visiting www.hbsslaw.com/GRPN. The deadline to move the court for lead plaintiff is June 4, 2012.
Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
Hagens Berman's lawsuit alleges that Groupon and its underwriters failed to disclose negative trends in the company's business and weakness in its internal financial controls, causing its stock to trade at artificially high prices during the Class Period.
Groupon went public in November 2011. The company initially priced its stock at $20.00 per share, but the stock price rose as high as $27.78 during the Class Period.
On March 30, 2012, Groupon shocked the market with an announcement that it would revise its fourth quarter, 2011 financial results. The revision, the company said, would include a reduction in revenue and an increase in operating expenses. Groupon also noted, "In conjunction with the completion of the audit of Groupon's financial statements for the year ended December 31, 2011 by its independent auditor, Ernst & Young LLP, the Company included a statement of a material weakness in its internal controls over its financial statement close process in its Annual Report on Form 10-K for year ended December 31, 2011."
Following the announcement, Groupon's stock declined sharply, losing nearly 17 percent of its value on April 2, 2012, closing at $15.27. The stock has continued to decline, and on April 16, 2012, closed at $12.67.
"We believe that in advance of its IPO, Groupon knew of serious weaknesses in its business model, but kept investors in the dark," said Mr. Kathrein. "Our lawsuit seeks to recover the losses of shareholders who were misled about the company's financial results and outlook."
Persons with knowledge that may help the investigation are encouraged to contact the firm. The SEC recently finalized new rules as part of its implementation of the whistleblower provisions in the Dodd-Frank Wall Street Reform Bill. The new rules protect whistleblowers from employer retaliation and allow the SEC to reward those who provide information leading to a successful enforcement with up to 30 percent of the recovery.
Hagens Berman Sobol Shapiro LLP is an investor-rights class-action law firm with offices in 10 cities. The firm represents whistleblowers, workers and consumers in complex litigation. More about the law firm and its successes can be found at www.hbsslaw.com. The firm's securities law blog is at www.meaningfuldisclosure.com.
Media Contact: Mark Firmani, Firmani + Associates, (206) 443-9357, Mark@firmani.com
SOURCE Hagens Berman Sobol Shapiro LLP