Contact Information: Peretz Bronstein or Eitan Kimelman Bronstein, Gewirtz & Grossman, LLC 212-697-6484
Bronstein, Gewirtz & Grossman, LLC Announces Class Action Lawsuit Against Koss Corporation
| Source: Bronstein, Gewirtz & Grossman, LLC
NEW YORK, NY--(Marketwire - January 20, 2010) - Bronstein, Gewirtz & Grossman, LLC announces
that a class action has been filed in the United States District Court for
the Eastern District of Wisconsin on behalf of those who purchased or
otherwise acquired stock of Koss Corporation ("Koss" or the "Company")
(NASDAQ : KOSS ) during the period between July 12, 2005 through and
including December 21, 2009 (the "Class Period").
The Complaint charges Koss and certain of the Company's current and former
executive officers with violations of federal securities laws. The
complaint alleges that throughout the Class Period defendants knew or
disregarded that their public statements concerning Koss's financial
performance were false and misleading. Specifically, defendants made false
and/or misleading statements and/or failed to disclose: (1) that certain
Company employees had devised and carried out a scheme to defraud investors
and divert Company funds potentially exceeding $31 million; (2) that the
Company's financial statements and corporate bank account balances had been
manipulated to conceal the diversion of corporate funds; (3) that, as a
result, the Company's financial results were overstated during the Class
Period; (4) that the Company's financial results were not prepared in
accordance with Generally Accepted Accounting Principles ("GAAP"); (5) that
the Company lacked adequate internal and financial controls; and (6), as a
result of the above, that the Company's financial statements were
materially false and misleading at all relevant times.
On December 21, 2009, Koss shocked investors when it announced that NASDAQ
halted trading of Koss stock at the Company's request after it discovered
certain unauthorized transactions at the Company, and the Board of
Directors had appointed a special committee of independent directors to
lead an internal investigation to determine the effect of the transactions
of Koss's Financial statements.
On December 24, 2009, the Company announced that its Principal Accounting
Officer had been terminated and two members of its accounting staff who
served under her had been placed on unpaid administrative leave.
Thereafter, the Company announced that its internal investigation had been
expanded to include the fiscal year 2005 and preliminary estimated that the
amount of the transactions had exceeded $31 million. Koss further announced
that it had dismissed Grant Thorton LLP as its independent auditors, and
its previously issued financial statements for the fiscal years ended June
30, 2005 through 2009 and the three months ended September 30, 2009, should
no longer be relied upon due to the unauthorized financial transactions.
On January 11, 2009, when trading in Koss stock resumed, shares of the
Company's stock declined $1.32 per share, approximately 24%, to close on
January 11, 2010, at $4.19 per share, on unusually heavy volume.
No Class has yet been certified in the above action. If you wish to review
a copy of the Complaint, to discuss this action, or have any questions,
please contact either Peretz Bronstein or Eitan Kimelman of Bronstein,
Gewirtz & Grossman, LLC at 212-697-6484 or via email eitan@bgandg.com.
Those who inquire by e-mail are encouraged to include their mailing address
and telephone number. March 16, 2010 is the deadline for investors to seek
a lead plaintiff appointment.
Bronstein, Gewirtz & Grossman, LLC is a corporate litigation boutique. Our
primary expertise is the aggressive pursuit of litigation claims on behalf
of our clients. In addition to representing institutions and other
investor plaintiffs in class action security litigation, the firm's
expertise includes general corporate work, private securities offerings,
and securities arbitration.