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Artificial Life Inc (OTC: ALIF) Investor Securities Class Action Lawsuit 04/15/2011

  • If you purchased shares of Artificial Life Inc (OTC: ALIF), you might have certain options and should contact the Shareholders Foundation, Inc.

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Lawsuit Overview

Case Dismissed
Company
Artificial Life, Inc.
Security
OTC: ALIF

Case Name
Artificial Life Shareholder Class Action Lawsuit 04/15/2011
Type of Lawsuit
Shareholder Class Action
Court of Filing
U.S. District Court for the Central District of California

Class Period Begin
Class Period End
Deadline To File for Lead
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Summary

April 29, 2011 - The plaintiff filed a notice of voluntary dismissal without prejudice.
April 15, 2011 - An investor in shares of Artificial Life Inc (OTC: ALIF) filed a lawsuit in the U.S. District Court for the Central District of California against Artificial Life Inc alleging violations of Federal Securities Laws after ALIF shares fell by almost 50% within a few trading days.

According to the complaint the plaintiff alleged that Artificial Life Inc violated the Securities Exchange Act of 1934.

Artificial Life Inc’s 12 months Total Revenue increased from $0.86 million in 2006 to $27.45 million in 2009. Its Net Income rose over the same time frame from a Net Loss of $2.94 million to $7.57 million. For the first three quarters in 2010 Artificial Life Inc reported a combined nine months Total Revenue that succeeded its 12 months Total Revenue. Artificial Life Inc reported a combined nine months Total Revenue of $27.78 million with a combined nine months Net Income that also succeeded its 12 months Net Income from 2009. Artificial Life Inc reported a combined nine months Net Income of $12.30 million.

Shares of Artificial Life Inc increased during 2007 to over $3, but fell during 2009 to under $0.70 per share. During the first months in 2010 ALIF shares rose to over $1.5 per share.

Then on April 13, 2010, Artificial Life Inc engaged KPMG to be its accountant. When conducting the audit for FY 2010, KPMG disagreed with Artificial Life Inc over its accounting treatment of reserves for account receivables and revenue recognition, preventing KPMG from issuing an unqualified opinion. Artificial Life Inc refused to alter the accounting treatment of these entries, and dismissed KPMG on April 6, 2011. On April 8, 2011, Artificial Life Inc (OTC: ALIF) shares traded as low as $0.31 per share and closed last Friday at $0.37 per share.