RADNOR, Pa., Oct. 31 /PRNewswire/ --
The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:
Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Southern District of New York on behalf of all common stock purchasers of Xethanol Corporation (AMEX:XNL) ("Xethanol" or the "Company") from January 31, 2006 through August 8, 2006, inclusive (the "Class Period").
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Schiffrin & Barroway, LLP (Darren J. Check, Esq. or Richard A. Maniskas, Esq.) toll-free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at .
The Complaint charges Xethanol and certain of its officers and directors with violations of the Securities Exchange Act of 1934. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that its Hopkinton, Iowa Permeate Refining plant was not being refurbished; rather the plant laid vacant and uninhabited with its doors locked; (2) that the Company lacked credible management personnel; (3) that Xethanol engaged in an alarmingly high number of related party transactions (such that the Company used a reverse merger into a shell corporation to avoid disclosing these facts); (4) that the Company materially underreported the true cost of completing a biomass to ethanol production facility and failed to take proper adjustments, which enabled defendants to materially overstate its profitability; (5) that, because the Company lacked the necessary personnel and controls to issue accurate financial reports and projections, the Company's financial statements were presented in violation of Generally Accepted Accounting Principles; and (6) that, as a result, the Company's statements regarding its prospects for biomass ethanol production were lacking in any reasonable basis when made.
On August 7, 2006, while the market was open, ShareSleuth.com, a forensic securities investigations website, published a report which criticized Xethanol and its management. Specifically, the report questioned Xethanol's position that it could achieve commercialization of ethanol and noted that many of Xethanol's financiers had been disciplined by regulatory agencies. The report also claimed that defendant Christopher d'Arnaud-Taylor ("Taylor"), Xethanol's Chairman and Chief Executive Officer, had falsified his work experience and qualifications on his resume.
News of this caused a sharp decline of Xethanol shares. Between August 8, 2006 and August 9, 2006, shares of Xethanol tumbled from $6.91 per share to $5.25 per share, a two-day decline of more than $1.60 per share.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin & Barroway, which prosecutes class actions in both state and federal courts throughout the country. Schiffrin & Barroway is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world. For more information about Schiffrin & Barroway, or to sign up to participate in this action online, please visit http://www.sbclasslaw.com/.
If you are a member of the class described above, you may, not later than December 26, 2006, move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Schiffrin & Barroway, or other counsel of your choice, to serve as your counsel in this action.
CONTACT: Schiffrin & Barroway, LLP
Darren J. Check, Esq.
Richard A. Maniskas, Esq.
280 King of Prussia Road
Radnor, PA 19087
1-888-299-7706 (toll-free) or 1-610-667-7706
Or by e-mail at
DATASOURCE: Schiffrin & Barroway, LLP
CONTACT: Darren J. Check, Esq. or Richard A. Maniskas, Esq. of Schiffrin
& Barroway, LLP, +1-888-299-7706, or +1-610-667-7706, or
Web site: http://www.sbclasslaw.com/