SOURCE: Izard Nobel LLP

October 04, 2010 18:03 ET

Izard Nobel LLP Announces Class Action Lawsuit Against FalconStor Software, Inc.

WEST HARTFORD, CT--(Marketwire - October 4, 2010) -  The law firm of Izard Nobel LLP, which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the Eastern District of New York on behalf of purchasers of the common stock of FalconStor Software, Inc. ("FalconStor" or the "Company") (NASDAQ: FALC) between February 5, 2009 and September 29, 2010, inclusive (the "Class Period"). 

The Complaint charges FalconStor and certain of its officers and directors with violations of federal securities laws. Specifically, the Complaint alleges that defendants misrepresented and/or failed to disclose the following adverse facts: (i) that the Company was experiencing weak demand for its products and services; (ii) that FalconStor was making improper payments to secure a contract with at least one of the Company's customers; and (iii) as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about FalconStor and its prospects.

Then, on September 29, 2010, FalconStor announced that ReiJane Huai "resigned from all of his positions with the Company, effective immediately." The press release stated that Mr. Huai "tendered his resignation following his disclosure that certain improper payments were allegedly made in connection with the Company's contract with one customer." On this news, shares of the Company's stock fell $0.91 per share, or 22%, to close at $3.15 per share.

If you are a member of the class, you may, no later than November 30, 2010, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members.

While Izard Nobel LLP has not filed a lawsuit against the defendants, to view a copy of the Complaint initiating the class action or for more information about the case, and your rights, visit: www.izardnobel.com/falconstor/, or contact Izard Nobel LLP toll-free: (800) 797-5499, or by e-mail: firm@izardnobel.com. For more information about class action cases in general, please visit our website: www.izardnobel.com.

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