According to the law firm press release, Cellular Biomedicine Group Inc., is a biomedicine company that develops treatments for cancerous and degenerative diseases in Greater China. It focuses on developing and marketing cell-based therapies to treat serious chronic and degenerative diseases, such as cancer, osteoarthritis, tissue damage, various inflammatory diseases, and metabolic diseases.
The Complaint alleges that throughout the Class Period, defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: (i) the Company achieved an unsustainable $500m valuation by using paid stock promoters, yet failed to disclose the use of such promoters in its regulatory filings pursuant to Section 17(b) of the Securities Act of 1933 ; (ii) the Company’s "Car-T" technology had experienced patient deaths and lacked any meaningful valuation; and (iv) as a result of the above, the Company’s financial statements were materially false and misleading at all relevant times.
On April 7, 2015, a report was published on Seekingalpha.com, alleging that the Company was engaged in a massive fraudulent scheme to mislead investors and that the Company lacked any meaningful financial value.
On this news, CBMG securities declined $7.00 per share, or over 21.7%, to close at $25.22 per share on April 7, 2015.
On August 3, 2015, the Court issued an Order appointing lead plaintiff and approving lead counsel. Lead Plaintiff filed an amended complaint on September 17.
On September 2, 2016, the Court issued an Order granting Defendants' motion to dismiss with prejudice. Plaintiffs filed a Notice of Appeal of this Order on September 16. This Appeal was voluntarily dismissed on January 27, 2017.