Boston, MA 10/29/2013 (wallstreetpr) – There seems to be no end to NQ Mobile Inc (ADR) (NYSE:NQ)’s troubles after it faces a fresh litigation from an investor, Phuong Ho. The complaint came after the company’s shares witnessed free fall post allegations of the company’s fabricated revenues by a research firm.
On Monday,Phuong Ho, an investor,who seeks to represent a group of shareholders has filed the complaint in federal court in Manhattan on behalf of all stockholders, who have brought the company’s shares in the period of May 5, 2011, initial public offering to Oct. 24.
The share prices of Beijing-based mobile Internet service provider fell by 62 percent to $8.80 after the Muddy Waters LLC disclosed its reports of the company’s overstated financial performance on Oct. 24.
The research firm, Muddy Waters LLC has leveled charges on the company that at least 72 percent of its revenue in China is fictitious and that its actual market share in China is just 1.5 percent as opposed to 55 percent, which the company claims. The report also raised eyebrows on the company’s financial statements which it has filed with the Chinese government and the U.S. Securities and Exchange Commission.
While shrugging off the allegations, the company’s spokeswoman Kim Titus maintained the company’s stand. The company had published its statement on Oct 24 where it had rubbished the reports of the research firm.
In the meanwhile, Ho has sought damages under federal securities laws on behalf of all the investors who bought common stock and call options or sold put options of the company since the time of the IPO. As per the complaint, it is notable that the investors have lost about $500 million in short span of just a few days after the company’s share price dropped on Oct 24.
NQ Mobile founded in 2005 ventures into products such as NQ Mobile Call Blocker,NQ Mobile Vaultand NQ Space.
