SHAREHOLDER ALERT: The Law Firm of Wohl & Fruchter Reminds ALC Investors with Losses of Deadline to Seek Lead Plaintiff Position
NEW YORK--(BUSINESS WIRE)-- On August 29, 2012, Wohl & Fruchter filed a class action against Assisted Living Concepts, Inc. (NYS: ALC) and its former Chief Executive Officer charging defendants with violations of the Securities Exchange Act of 1934, and seeking damages on behalf of investors who purchased ALC Class A common stock between March 12, 2011 and August 6, 2012 (the Class Period).
The Firm wishes to remind shareholders who purchased ALC shares during the Class Period and suffered losses, and who may wish to serve as a lead plaintiff, that you have until October 29, 2012 to seek appointment as lead plaintiff by the Court. To discuss the case or learn more about becoming a lead plaintiff, please contact J. Elazar Fruchter at firstname.lastname@example.org, or call us toll free at 866.582.8140. A copy of the complaint filed by Wohl & Fruchter can be obtained at: http://www.wohlfruchter.com/cases/alc.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements, and omitted material information concerning ALC's compliance with its obligations under a lease covering eight assisted living facilities operated by ALC. Under the terms of the lease, ALC was obligated to maintain specified occupancy rates and insure all regulatory licenses remained in good standing. In its quarterly and annual SEC filings, ALC confirmed its compliance with these obligations.
Undisclosed to investors, however, there is substantial evidence that during the Class Period, ALC failed to maintain the specified occupancy rates and concealed this fact by treating units leased to employees as bona fide rentals. Also undisclosed to investors until revealed in a lawsuit filed by the landlord, state regulators in Georgia and Alabama served notices in February and March 2012 of their intent to revoke licenses for three of the facilities, further violating the lease.
In early May 2012, the audit committee of ALC's board of directors launched an investigation after receiving an internal whistleblower complaint concerning "possible irregularities in connection with" the lease, and on June 21, 2012, ALC settled with the landlord, causing ALC to incur a net loss of $19.5 million for the first six months of 2012 - an amount close to ALC's entire net income in 2011.
On August 7, 2012, ALC announced that it was the subject of an SEC investigation concerning a number of topics, including "compliance with occupancy covenants" under the lease and the "leasing of units for employee use."
Upon this news, ALC shares fell over 26 percent to close at $7.89 per share on August 7, 2012, representing a loss of shareholder value of over $51 million.
The plaintiff is represented by Wohl & Fruchter LLP, an experienced securities litigation firm representing plaintiffs in class actions arising from fraud and other fiduciary breaches by corporate managers, as well as other complex litigation matters. Please visit our website, www.wohlfruchter.com, to learn more about our Firm.
This release may be deemed to constitute attorney advertising.
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The article SHAREHOLDER ALERT: The Law Firm of Wohl & Fruchter Reminds ALC Investors with Losses of Deadline to Seek Lead Plaintiff Position originally appeared on Fool.com.
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