According to a press release dated June 12, 2010, a class action lawsuit on behalf of purchasers of the securities of China North East Petroleum Holdings Limited, including purchasers of common stock, call options, and/or sellers of put options during the Class Period.
The complaint charges China North and certain of its officers and directors with violations of the federal securities laws for issuing false and misleading financial information to investors. According to the complaint, on May 27, 2010, China North announced that in 2009 a Company officer and a Company director engineered improper cash transfers between bank accounts of the Company and their personal accounts. The Company also announced that it's CFO and a director had resigned. China North also announced that its CEO was placed on administrative leave and that he stepped down as Chairman of the Board, both pending the outcome of the Company's forensic audit. As a result of these adverse events, China North's stock has been halted and investors have suffered losses.
On November 19, 2010, Judge Miriam Goldman Cedarbaum granted the motion to consolidate the two related actions and appointed 1:10-cv-4577 as lead case. Judge Cedarbaum further appointed Acticon AG as lead plaintiff and approved lead plaintiff’s lawyer, Pomerantz Haudek Block Grossman and Gross LLP, as lead counsel. On January 14, 2011, the lead plaintiff filed a Consolidated Complaint, naming additional defendants in the action. On March 22, 2011, the defendants filed three separate motions to dismiss the Consolidated Complaint.
According to a press release dated October 12, 2011, China North East Petroleum Holdings Limited (the "Company") (NYSE Amex: NEP), a leading independent oil producing and oilfield services company in Northern China, today announced that the United States District Court for the Southern District of New York has dismissed the three consolidated securities class actions pending against NEP and certain of its current and former officers and directors. ... After briefing and oral arguments, the Honorable Miriam Cedarbaum, United States District Judge for the Southern District of New York, on October 6, 2011, ordered that the consolidated actions be dismissed as to all defendants and the case closed. The Clerk of the Court entered judgment of dismissal on October 11, 2011. The Company understands that plaintiffs may appeal. This dismissal comes on the heels of the dismissal on May 23, 2011 of three shareholder derivative actions that are based on the same circumstances as the class actions and an order denying a subsequent motion to re-open the case on July 8, 2011. An appeal to the Second Circuit Court of Appeals in the derivative actions is pending.