NEW YORK--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/nqmobile/) today announced that a class action has been commenced in the United States District Court for the Southern District of New York on behalf of purchasers of NQ Mobile, Inc. (“NQ Mobile”) (NYSE:NQ) securities during the period between May 5, 2011 and October 24, 2013 (the “Class Period”).
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from October 28, 2013. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Samuel H. Rudman or David A. Rosenfeld of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at email@example.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/nqmobile/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges NQ Mobile and certain of its officers and directors with violations of the Securities Exchange Act of 1934. NQ Mobile, a firm based in both Dallas, Texas and Beijing, China, holds itself out as a global provider of mobile Internet services. The Company focuses on serving clients in three sectors: mobile security, mobile productivity and personalized intelligent cloud services.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements concerning the Company’s financial condition, business relationships, operations, and prospects. Specifically, the complaint alleges that defendants failed to disclose, among other things, that NQ Mobile far overstated its presence and market share in China and further misrepresented the size of its paying user base, that the Company’s antivirus program, Antivirus 7.0, was actually a spyware program that left users’ devices subject to attack, and that the Company’s revenue and reported cash balances were materially overstated at all relevant times. As a result of defendants’ false and misleading statements and omissions, NQ Mobile’s shares traded at artificially inflated prices throughout the Class Period.
Then, on October 24, 2013, Muddy Waters Research released an 81-page report on the Company concluding, among many other things, that NQ Mobile is “a massive fraud.” The report, accompanied by a “strong sell” rating, stated that NQ Mobile’s rightful stock price is “zero.” The report also stated that NQ Mobile had far overstated its presence in China, with an actual paying user base estimated at less than 250,000 – compared to the 6 million the Company claimed to have – and that NQ Mobile’s real market share in China was only about 1.5% versus the approximately 55% defendants had reported to investors. The report also asserted that at least 72% of NQ Mobile’s Chinese security software revenue was “fraudulent.” The report further described how NQ Mobile’s third-party payments channel was “non-existent,” and that its Chinese payments portal was “purely cosmetic.” The report labeled NQ Mobile’s antivirus program, Antivirus 7.0, as “unsafe for sale to consumers,” because it was, in reality, “spyware” that makes users’ phones vulnerable to cyber-attack. On this news, NQ Mobile shares began to fall, dropping as much as 63% to a low of $8.46 per share, and trading was halted several times after hitting single-stock circuit breakers. Ultimately, the shares declined 47%, or $10.79 per share, to close at $12.09 on October 24, 2013, on abnormally large trading volume of more than 29 million shares traded.
Plaintiff seeks to recover damages on behalf of all purchasers of NQ Mobile securities during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller represents U.S. and international institutional investors in contingency-based securities and corporate litigation. With nearly 200 lawyers in nine offices, the firm represents hundreds of public and multi-employer pension funds with combined assets under management in excess of $2 trillion. The firm has obtained many of the largest recoveries and has been ranked number one in the number of shareholder class action recoveries in MSCI’s Top SCAS 50 every year since 2003. Please visit http://www.rgrdlaw.com for more information.