SOURCE: Izard Nobel LLP

March 30, 2011 17:39 ET

Izard Nobel LLP Announces Class Action Lawsuit Against Rosetta Stone, Inc.

WEST HARTFORD, CT--(Marketwire - March 30, 2011) - 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 Virginia on behalf of purchasers of the common stock of Rosetta Stone, Inc. ("Rosetta Stone" or the "Company") (NYSE: RST) between February 25, 2010 and March 1, 2011, inclusive (the "Class Period").

The Complaint charges Rosetta Stone and certain of its officers and directors violated federal securities laws. Specifically, the Complaint alleges: (i) that Rosetta Stone was facing intense competition for its products, including free competitive product offerings; (ii) that the free and lower priced competitive product offerings, not a temporary reduction in advertising, was having a material adverse effect on the Company's Class Period revenues, particularly U.S. consumer revenues; (iii) that the favorable sales booking numbers Rosetta Stone reported during the Class Period was the result of key retail partners maintaining inventory of the Company's products well above historic levels; and (iv) that Rosetta Stone's reported sales bookings and revenues during the Class Period were the product of manipulation.

On February 28, Rosetta Stone announced fourth quarter revenue of $74.3 million, a 5% decrease from the prior year, net income on a GAAP basis of $5.0 million, a decrease of 60% from the 2009 fourth quarter. On this news, shares of Rosetta Stone fell $1.77 to $13.19 per share.

If you are a member of the class, you may, no later than May 23, 2011, 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/rosettastone/, 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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