An investor of China Ceramics Co, Ltd. has filed a federal securities fraud class action complaint against the company, citing misleading statements that allegedly violated the Securities Exchange Act of 1934, according to Robbins Arroyo LLP.
The complaint, filed in the U.S. District Court for the Southern District of New York, maintain that China Ceramics misled investors between March 30, 2012 and May 1, 2014.
The NASDAQ Stock Market halted trading for China Ceramics on May 1, requesting additional information. The company then announced that its financial statements for the year ended Dec. 31, 2013 were incomplete. It also revealed that its principal registered public accountant, Grant Thornton, was fired on April 30. A new accounting firm had been employed to audit its financial statements for 2013, 2012 and 2011.
According to Robbins Arroyo, China Ceramics also neglected to disclose the risk associated with substantial write-downs of company assets, which culminated in an estimated $7.5 million asset write-down for the fourth quarter of 2013.
At the moment, trading on the stock market has yet to resume for the company.