According to the Complaint, it is alleged that Defendants intentionally and/or with deliberate recklessness engaged
in a manipulative course of business conduct in which they falsely represented to the investing public that all of their revenues were derived from the sale of aerospace devices, called momentum wheels, when in fact its revenues were largely derived from illegally exporting military semiconductors to Hong Kong.
Defendants failed to disclose to investors their unlawful exportation of semiconductors to Hong Kong or explain to investors that its cash holdings were the fruits of illegal activities that could be seized at any time. In addition,
Defendants failed to disclose to investors that its export activities were subject to United States arms control regulations that could seriously and negatively impact the price of Valley Forge’s common stock. Upon disclosure of the U.S. Attorney’s investigation and seizure of Valley Forge’s cash holdings, the company’s common stock price plummeted by more than fifty percent.
On January 10, 2014, the Court GRANTED Plaintiff’s motion for appointment of lead plaintiff and lead counsel.
On April 28, 2014, the Court GRANTED Defendant’s motion and DISMISSES Plaintiff’s complaint. The Court allowed Plaintiff to file an amended complaint which cures the defects within fourteen (14) days from the date of the order. On May 12, the Plaintiff filed the amended complaint.
On July 29, 2014, the Court issued an Order denying Defendants' motions to dismiss for failure to state a claim under Section 10(b) of the Exchange Act. The Court granted an individual defendant's motion to dismiss for failure to state a claim under Section 20(a). Plaintiff was given leave to file an amended complaint.
On January 26, 2015, the Court issued an Order staying the case pending the resolution of the criminal case of one of the Defendants in the Eastern District of Kentucky.