PALM BEACH GARDENS, Fla., April 25, 2016 (GLOBE NEWSWIRE) — Cohen Milstein Sellers & Toll PLLC, a leading national firm with offices in Palm Beach Gardens, Florida, is conducting an investigation to determine whether South Florida-based DS Healthcare Group, Inc. (“DS Healthcare” or the “Company”) and certain of its officers and directors made false and misleading statements and/or omissions in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
A class action lawsuit was filed in the U.S. District Court for the Southern District of Florida by another law firm on behalf of purchasers of the common stock of DS Healthcare Group, Inc. (NASDAQ:DSKX) between May 15, 2014 and April 3, 2016, inclusive (the “Class Period”).
The complaint alleges that DS Healthcare and certain of its officers and directors (“Defendants”) misrepresented and/or failed to disclose that: (1) the Company improperly recognized and reported revenue in violation of GAAP; (2) the Company did not properly record or disclose certain equity transactions in violation of GAAP; (3) the Company lacked adequate internal controls over accounting and financial reporting; and (4) as a result of the foregoing, the Company’s financial statements, as well as Defendants’ statements about DS Healthcare’s business, operations, and prospects, were false and misleading.
On March 23, 2016, the Company disclosed that the Company’s financial statements for the second and third quarters ended June 30, and September 30, 2015 “should no longer be relied upon because of certain errors in such financial statements.” The Company reported that this was the decision reached the previous week by the Company’s Audit Committee after consulting with DS Healthcare’s auditor, Marcum LLP. DS Healthcare shares fell from $1.33 to $0.86 on March 24 in heavy trading.
On March 28, DS Healthcare issued an update disclosing the amounts and other details of the errors that necessitated a restatement. The price of DS Healthcare shares fell from $0.81 to $0.72 on March 29.
The Company filed a form 8-K on April 3, which disclosed details concerning the nature of the alleged misconduct of former Chairman, CFO and President of the Company, Daniel Khesin, both during and after the Class Period, as well as the basis for his termination stating, in relevant part:
Action for [Khesin’s] termination for cause was provided at the recommendation of independent legal counsel that specializes in SEC investigative work, which had been engaged by the audit committee, that demonstrated that Mr. Khesin engaged in a series of questionable stock transactions without board authorization, engaged in self-dealing and potentially engaged in transactions designed to artificially inflate the price of DSKX common stock.
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The Company further reports that on April 2, 2016, Mark Brockelman has tendered his resignation as the Company’s Chief Financial Officer.
NASDAQ halted trading in DS Healthcare shares on April 4. After the market close on April 6, the Company filed another 8-K reporting that:
On March 31, 2016, DS Healthcare shareholders have removed the Directors Michael Pope, Karl Sweis, and Dianne Rosenfeld in connection with concerns regarding violations of various obligations to shareholders and the resulting rapid decline in DS Healthcare securities and ensuing liabilities.
Cohen Milstein encourages all investors who purchased DS Healthcare common stock between May 15, 2014 and April 3, 2016, or former employees with information concerning this matter to contact the firm.
If you are a DS Healthcare shareholder and would like to discuss your right to recover for your economic loss, you may, without any cost or obligation, call Cohen Milstein’s Managing Partner, Steven J. Toll at (888) 240-0775 or (202) 408-4600, or email him at email@example.com. If you wish to serve as lead plaintiff, you must move the Court no later than May 31, 2016 to request appointment. Any member of the proposed class may retain Cohen Milstein or other attorneys to serve as your counsel in this action, or you may do nothing and remain an absent class member.
Cohen Milstein has significant experience in prosecuting investor class actions and actions involving securities fraud, and is active in major litigation pending in federal and state courts throughout the nation. Cohen Milstein has taken a lead role in numerous important cases on behalf of defrauded investors, and has been responsible for a number of outstanding recoveries which, in the aggregate, total over two billion dollars. Prior results do not guarantee a similar outcome. For more information visit www.cohenmilstein.com.
If you have any questions about this notice or the action, or with regard to your rights, please contact either of the following:
Steven J. Toll, Esq.
Cohen Milstein Sellers & Toll PLLC
Telephone: (888) 240-0775 or (202) 408-4600
Email: firstname.lastname@example.org; email@example.com