New York, New York--(Newsfile Corp. - April 8, 2020) - Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in CPI Aerostructures Inc. (NYSE: CVU) ("CPI" or the "Company") of the April 24, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
Faruqi & Faruqi logo
If you invested in CPI stock or options between May 15, 2018 and February 14, 2020 and would like to discuss your legal rights, click here: www.faruqilaw.com/CVU. There is no cost or obligation to you.
You can also contact us by calling Richard Gonnello toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to firstname.lastname@example.org.
FARUQI & FARUQI, LLP
685 Third Avenue, 26th Floor
New York, NY 10017
Attn: Richard Gonnello, Esq.
Telephone: (877) 247-4292 or (212) 983-9330
The lawsuit has been filed in the U.S. District Court for the Eastern District of New York on behalf of all those who purchased CPI common stock between May 15, 2018 and February 14, 2020 (the "Class Period"). The case, Rodriguez v. CPI Aerostructures, Inc. et al., No. 20-cv-00982 was filed on February 24, 2020.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by failing to disclose that: (1) CPI Aerostructures' financial statements included in the Company's Forms 10-Q for the first, second, and third quarters of 2018 and 2019 incorrectly applied generally accepted accounting principles and thus revenue, net income, retained earnings, and contract assets were overstated; (2) as a result, the financial statements included in the Form 10-Qs for 2018 and 2019 and the annual report on Form 10-K for 2018 could no longer be relied upon and required restatement; (3) CPI Aerostructures lacked adequate internal controls over financial reporting and effective disclosure controls and procedures as of the period during each reporting period of 2018; (4) CPI Aerostructures lacked effective disclosure controls and procedures during the third quarter of 2019; and (5) as a result, defendants' statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.
On February 8, 2019, before market hours, CPI Aerostructures filed a Form 8-K with the SEC, reporting that its previously filed 3Q 2018 10-Q should no longer be relied upon. Specifically, CPI Aerostructures disclosed that, during the three and nine months ended September 30, 2018, revenue was overstated by $900,000 to $950,000, net income was overstated by $725,000 to $775,000, and, as a result, earnings per share were overstated by $0.09 per share, for each such period. CPI Aerostructures also admitted that management determined the Company had a material weakness in its internal control over financial reporting as of September 30, 2018, and that its disclosure controls and procedures were not effective.
After the announcement, CPI's share price fell from $6.93 per share on February 7, 2019 to a closing price of $6.34 on February 8, 2019-a $0.59 or 8.51% drop.
Then, on February 14, 2020, CPI announced that its financial statements for fiscal year 2018, the last three quarters of 2018, and the first two quarters of 2019 should no longer be relied upon due to errors in those financial statements relating to the Company's recognition of revenue from contracts with customers under ASC Topic 606.
In addition, the Company announced that investors should no longer rely upon the independent auditor's reports on the effectiveness of internal control over financial reporting for the year ended December 31, 2018, as well as management's reports on the effectiveness of internal control over financial reporting, press releases, and investor communications describing the Company's financial statements for these periods. The Company also announced the resignation of its Chief Financial Officer.
After the announcement, CPI's share price fell from $6.67 per share on February 13, 2020 to a closing price of $4.87 on February 14, 2020-a $1.80 or a 26.99% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding CPI's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
Attorney Advertising. The law firm responsible for this advertisement is Faruqi & Faruqi, LLP (www.faruqilaw.com). Prior results do not guarantee or predict a similar outcome with respect to any future matter. We welcome the opportunity to discuss your particular case. All communications will be treated in a confidential manner.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/54240