The Complaint alleges that throughout the Class Period, the Company made false and/or misleading statements, as well as failed to disclose material adverse facts about the Company's business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (1) the Company was unable to provide the investing public with accurate and current information regarding its current financial results, operations or governance; (2) the Company lacked adequate internal and financial controls; and (3) as a result of the foregoing, the Company’s statements were materially false and misleading at all relevant times. As a result of Company’s wrongful acts and omissions, and the precipitous decline in the market value of the Company's securities, Class members have suffered significant losses and damages.
On April 30, 2012, the Company disclosed that it would not be able to file its annual report for the year ended December 31, 2011 “due to delays in obtaining certain required documents and information necessary for its public accounting firm to complete their audit procedures in a timely manner.”
On May 2, 2012, the Company announced the immediate resignation of its Chief Financial Officer. On this news Qiao Xing Mobile shares declined $0.20 per share or 29%, to close at $0.48 per share.
On May 17, 2012, the NYSE delisted Qiao Xing Mobile shares. When the stock started trading on over-the-counter market the next day, the stock declined $0.33 per share or nearly 69%, to close at $0.15 per share on May 18, 2012.
On April 15, 2013, the Court appointed Mr. Ghodooshim to serve as lead plaintiff and approved Pomerantz Grossman Hufford Dahlstrom & Gross LLP as of lead counsel.
On May 23, 2013, the Court entered a default judgment against the Defendant QXM after not having answered, moved, or otherwise responded to the Complaint and the time for doing so had expired. Accordingly, the Court certified the plaintiff class and judgment was appropriately entered pursuant to Fed. R. Civ. P. 54(b).