SEATTLE, Jan. 18 /PRNewswire/ -- Hagens Berman Sobol Shapiro filed a proposed class-action lawsuit on behalf of CellCyte Genetics Corporation (BULLETIN BOARD: CCYG) shareholders alleging company executives knowingly misrepresented the company and chief executive officer Gary A. Reys' background, causing company stocks to be traded at artificially inflated prices.
The lawsuit filed in U.S. District Court in Seattle claims defendants violated sections of The Exchange Act of 1934 during the class period of April 6, 2007 until and including January 9, 2008.
The complaint alleges that Reys' background was called into question after published news reports called out alleged discrepancies relating to Reys' finance degree from the University of Washington, a CPA designation, ties to the Washington Society of Certified Public Accountants and a strong track record within the pharmaceutical industry.
According to the complaint, CellCyte not only made these statements to potential investors but also to the Securities and Exchange Commission (SEC). These published statements had the cause and effect of creating an unrealistically positive assessment of CellCyte's prospects for investors.
According to the complaint, when CellCyte began looking for investors it sent unsolicited faxes to investors in Germany. The fax contained a story about CellCyte and a handwritten note announcing that "This is the stock that's about to take off!"
Additional claims made to both U.S. and German investors included "CellCyte shares could be the chance of your lifetime to turn $10,000 into $4 million, maybe even $15 million!" In addition to money making promises Reys' background was also touted in promotional materials, the complaint states.
Suspicion of the company came to light in early December 2007 when The Seattle Times published an article about the company's skyrocketing stock value. According to The Seattle Times, "a wave of glossy brochures and spam faxes, touting CellCyte with lofty claims, has helped propel the company's total market value to more than $440 million."
The complaint claims soon after Reys' credibility came into question, CellCyte took some of his biography information off its Web site. Within days of the removal, company stock fell 55 percent to $2.20 a share. CellCyte traded at a high of $7.02 per share just days before.
The Complaint alleges that the Defendants violated Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 10b-5 promulgated there under against all defendants and that Defendants Gary A. Reys, Ronald W. Berninger, Robert H. Harris, G. Brent Pierce and James L. Rapholz violated Section 20(a) of the Exchange Act.
If you invested in CellCyte during the outlined class period you may be eligible to join this suit and move to be a lead plaintiff. The deadline for moving is March 14, 2008. You can contact plaintiff's counsel, Reed Kathrein at 510-725-3000, or via e-mail at
About Hagens Berman Sobol Shapiro
Hagens Berman Sobol Shapiro is based in Seattle with offices in Chicago, Cambridge, Los Angeles, Phoenix and San Francisco. Since 1993, it has developed a nationally recognized practice in class-action and complex litigation. Among recent successes, HBSS has negotiated a $300 million settlement in the DRAM memory antitrust litigation, one of the largest anti-trust settlements in history; a $340 million recovery on behalf of Enron employees; a $150 million settlement involving charges of illegally inflated charges for the drug Lupron, and served as co-counsel on the Visa/Mastercard litigation which resulted in a $3 billion settlement, the largest anti-trust settlement to date. HBSS served as counsel in a $850 million Washington Public Power Supply settlement and represented Washington and 12 other states against the tobacco industry that resulted in the largest settlement in history. For a complete listing of HBSS cases, visit http://www.hbsslaw.com/.
CONTACTS:
Reed Kathrein (510) 725-3000 Mark Firmani (206) 443-9357
Hagens Berman Sobol Shapiro Firmani + Associates Inc.
