Robbins Arroyo LLP: Code Rebel Corporation (CDRB) Misled Shareholders According to a Recently Filed Class Action
Robbins Arroyo LLP announces that a class action complaint was filed against Code Rebel Corporation (NASDAQCM: CDRB) in the Superior Court of the State of California for the County of Los Angeles. The complaint is brought on behalf of all purchasers of Code Rebel securities pursuant to the company’s May 19, 2015 initial public stock offering (“IPO”), for alleged violations of the Securities Act of 1933 by Code Rebel’s officers and directors. Code Rebel is a software and information technology services company.
Code Rebel Accused of Misrepresenting Its Financial Condition
According to the complaint, on May 19, 2015, Code Rebel held its IPO, selling over one million shares at $5.00 per share and raising more than $5 million. The offering documents filed in connection with the IPO included Code Rebel’s financial statements for the fiscal years 2013 and 2014. The company also included a report from an independent public accounting firm which stated that Code Rebel’s financial statements fairly represented the financial position of the company and the results of its operations and cash flows were in conformity with accounting principles generally accepted in the United States. Code Rebel further stated in the offering documents that it was undertaking steps to comply with the requirements of being a public company, including implementing new internal controls and procedures.
The complaint alleges that the offering documents filed in connection with the IPO were misleading because they failed to disclose that Code Rebel’s financial statements contained errors regarding its assets and financial condition and the company’s steps to ensure compliance were ineffective. On May 6, 2015, the U.S. Securities and Exchange Commission issued an order suspending the trading of Code Rebel’s stock because of questions regarding the accuracy of the company’s statements concerning its assets and financial condition. On May 18, 2016, Code Rebel filed for bankruptcy in the U.S. Bankruptcy Court for the District of Delaware. On May 23, 2016, shares of the company resumed trading and fell $2.11 per share, or over 97%, to close at $0.05 per share.
Code Rebel Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.
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