Law firm investigating stock sales by Central European Distribution, says CEO may have sold US$1.7M worth of company stock based on insider information
October 28, 2011
– Hagens Berman Sobol Shapiro LLP today announced that it is investigating stock sales by Central European Distribution Corp. (NASDAQ:CEDC - News) executives while CEDC was allegedly experiencing undisclosed problems with its business.
Hagens Berman partner Reed R. Kathrein is leading the firm's investigation. "It appears that CEDC's CEO, William V. Carey, sold $1.7 million in stock in December 2010," he said. "We are investigating what Carey knew and when he knew it in light of the significant problems the Company admits occurred in November and December 2010."
Institutional investors and others who purchased CEDC stock between August 5, 2010, and February 28, 2011, and who have losses exceeding $50,000, are encouraged to contact the firm. Reed R. Kathrein can be reached at (510) 725-3000 or via email at CEDC@hbsslaw.com. Investors can also learn more about this investigation at www.hbsslaw.com/CEDC. The deadline to move the court for lead plaintiff in a class-action lawsuit filed on behalf of investors is December 23, 2011.
CEDC is a producer of spirits and is one of the largest producers of vodka, especially in Central and Eastern Europe. Operations in Poland and Russia form a large part of the company's business.
The lawsuit, filed on October 24, 2011, alleges that the company misled investors by misrepresenting its business prospects, especially with regard to its business in Poland.
The lawsuit claims that CEDC failed to timely disclose material information to investors, including declines in its vodka portfolio, especially in Poland, and negative financial results from the launch of Zubrowka Biala, a new vodka product.
On March 1, 2011, the company issued a press release announcing financial results for 2010. The company reported net losses exceeding $90 million, shocking investors. The company's stock fell more than 37 percent, down more than $8.50 per share, according to the complaint.
Persons with knowledge that may help the investigation are encouraged to contact the firm. The SEC recently finalized new rules as part of its implementation of the whistleblower provisions in the Dodd-Frank Wall Street Reform Bill. The new rules protect whistleblowers from employer retaliation and allow the SEC to reward those who provide information leading to a successful enforcement with up to 30 percent of the recovery.
About Hagens Berman
Seattle-based Hagens Berman Sobol Shapiro LLP is an investor-rights class-action law firm with offices in ten cities. Founded in 1993, the firm's mission is to represent plaintiffs in class actions and multi-party, large-scale litigation that has the potential to protect the rights of investors, consumers, workers and the environment. The National Law Journal has rated Hagens Berman as one of the top ten plaintiffs' firms in the country four out of the last five years. More information about the firm is available at www.hbsslaw.com, and the firm's securities law blog is at www.meaningfuldisclosure.com.