Cohen Milstein Sellers & Toll PLLC is conducting an investigation to determine whether magicJack VocalTec, Ltd. (“magicJack” or the “Company”) and certain of its officers and directors made false and misleading statements and/or omissions in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
A class action lawsuit was filed in the U.S. District Court for the Southern District of New York by another law firm on behalf of purchasers of the common stock of magicJack VocalTec, Ltd. (NASDAQ: CALL) between February 28, 2012 and January 8, 2013, inclusive (the “Class Period”).
The complaint alleges that magicJack and certain of its officers and directors (“Defendants”) misrepresented and/or failed to disclose that: (1) the Company overstated its revenue, earnings and cash flow; (2) the Company overstated its cash balance by investing in highly aggressive, unconventional securities; (3) the Company overstated its earnings by inconsistently treating its allowance for doubtful accounts and billing adjustments; (4) the Company improperly altered the estimated life of its assets, causing a decrease in depreciation expense; (5) while the Company claimed it was writing down excess inventory of chips it instead wrote down finished products to hide weakening sales; and (6) as a result of the foregoing, the Company’s financial statements were materially false and misleading.
On January 9, 2013 a report was published by an anonymous short-seller using the pseudonym “Copperfield Research” accusing the Company of overstating its revenues and income, engaging in “financial shenanigans, every shade of slimy” and “using accounting gimmicks to create a myriad of unsustainable earnings.” The report stated that:
We will unequivocally show that magicJack has presented its retail investor base with earnings press releases and financial tables that are overstated and later altered based on the corresponding SEC filings. It is our belief that the company wantonly misrepresented its financial results in front of a proposed secondary offering, and has continued to provide investor correspondence that is blatantly misleading and inaccurate. This brazen stock manipulation has been exacerbated by a series of ploys to attract and pump retail investors. We believe that an SEC investigation is not only warranted, but is a necessity as magicJack's Board of Directors appears deeply conflicted and agnostic towards oversight.
Following this report, the price of magicJack shares fell from $17.31 to $15.30 on January 9.
Cohen Milstein encourages all investors who purchased magicJack common stock between February 28, 2012 and January 8, 2013, or former employees with information concerning this matter to contact the firm.
If you are a magicJack shareholder and would like to discuss your right to recover for your economic loss, you may, without any cost or obligation, call Cohen Milstein’s Managing Partner, Steven J. Toll at (888) 240-0775 or (202) 408-4600, or email him at firstname.lastname@example.org. If you wish to serve as lead plaintiff, you must move the Court no later than March 19, 2013 to request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. To be appointed lead plaintiff, the Court must decide that your claim is typical of the claims of other class members, and that you will adequately represent the class. Your share in any recovery will not be enhanced or diminished by the decision whether or not to serve as a lead plaintiff. Any member of the proposed class may retain Cohen Milstein Sellers & Toll PLLC or other attorneys to serve as your counsel in this action, or you may do nothing and remain an absent class member.
Cohen Milstein Sellers & Toll PLLC has significant experience in prosecuting investor class actions and actions involving securities fraud. The firm has offices in Washington, D.C., New York, Chicago, Philadelphia and Palm Beach Gardens, and is active in major litigation pending in federal and state courts throughout the nation.
The firm’s reputation for excellence has repeatedly been recognized by courts which have appointed the firm to lead positions in complex multi-district or consolidated litigation. Cohen Milstein Sellers & Toll PLLC has taken a lead role in numerous important cases on behalf of defrauded investors, and has been responsible for a number of outstanding recoveries which, in the aggregate, total over a billion dollars. Prior results do not guarantee a similar outcome. For more information visit www.cohenmilstein.com.
If you have any questions about this notice or the action, or with regard to your rights, please contact either of the following:
Steven J. Toll, Esq.
Cohen Milstein Sellers & Toll PLLC
1100 New York Avenue, N.W.
West Tower, Suite 500
Washington, D.C. 20005
Telephone: (888) 240-0775 or (202) 408-4600
Email: email@example.com; firstname.lastname@example.org
Steven J. Toll, Esq.
888-240-0775 or 202-408-4600
888-240-0775 or 202-408-4600
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