OKC firm files securities case against software company

  • OKC firm files securities case against software company

OKLAHOMA CITY – A securities class-action lawsuit was recently filed in the United States District Court for the Southern District of New York against the software and services company Cleanspark Inc.

The complaint alleges violations of federal securities laws, including allegations of issuing a series of material or false misrepresentations to the market which artificially inflated the market price during the class period from Dec. 31, 2020, through Jan. 14, 2021, according to a news release from the Oklahoma City-based law firm Federman and Sherwood.

Cleanspark allegedly made materially false and/or misleading statements and failed to disclose material adverse facts about the company’s business, operations and prospects, according to the news release. Specifically, Cleanspark allegedly failed to disclose to investors that:

• The company had overstated its customer and contract figures.

• Several of the company’s recent acquisitions involved undisclosed related party transactions.

As a result, the defendants’ positive statements about the company’s business operations and prospects were materially misleading and/or lacked a reasonable basis.

On Jan. 14, Culper Research published a report titled “Cleanspark (CLSK): Back to the Trash Can,” alleging that Cleanspark “fabricated key elements of its business, including purported customers and contracts” and is also “rife with undisclosed related party transactions.”

On this news, the company’s share fell $3.63 per share, or 9%, to close at $35.71 per share on Jan. 14, thereby injuring investors, according to the news release. The stock continued to decline during the next trading session by $4.56, or 13%, to close at $31.15 per share on Jan. 15.

The plaintiff seeks to recover damages on behalf of Cleanspark shareholders who purchased common stock during the class period and are therefore members of the class as described above. Shareholders may apply no later than March 22 to serve as a lead plaintiff for the entire class. However, in order to do so, shareholders must meet legal requirements under the Private Securities

Litigation Reform Act of 1995. If you wish to discuss this action, obtain further information and participate in this litigation, or if you have any questions or concerns regarding this notice or preservation of your rights, contact Robin Hester at rkh@federmanlaw.com.