Rosetta Stone Inc.
Robbins Umeda LLP Announces an Investigation of Rosetta Stone Inc.
Robbins Umeda LLP, a shareholder rights litigation firm, is interested in helping shareholders of Rosetta Stone Inc. The firm has commenced an investigation into possible breaches of fiduciary duty and other violations of the law by certain officers and directors at Rosetta Stone Inc. (NYSE: RST). Rosetta Stone develops and sells language learning software, online services, and audio practice tools primarily under the Rosetta Stone brand name. The company is incorporated in Delaware and headquartered in Arlington, Virginia.
Robbins Umeda LLP’s investigation is focused on whether the officers and directors of Rosetta Stone issued improper financial statements to the investing public and whether they breached their fiduciary duties. In particular, the officers and directors failed to disclose that the company’s customers’ inventories were above historic levels and that the company was facing increased competition. As such, Rosetta Stone’s results failed to meet its publicly stated expectations, as demonstrated by its February 28, 2010 press release announcing results for the fourth quarter of 2010. The company reported $74.3 million in revenue, a 5% decrease from the prior year period. Further, it reported net income on a Generally Accepted Accounting Principles basis of $5.0 million, or $0.23 per share, a decrease of 60% from the fourth quarter of 2009. On this news, Rosetta Stone’s value fell $1.77 per share, or almost 12%, to close at $13.19 per share.
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