Enservco Corporation (ENSV) Delays Filing its Year End and Quarterly Reports Due to Accounting Errors
A shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired Enservco Corporation (NYSE: ENSV) securities between May 13, 2021 and April 19, 2022, for violations of the Securities Exchange Act of 1934. Enservco provides well enhancement and fluid management services to the onshore oil and natural gas industry in the U.S.
According to the complaint, defendants made false and/or misleading statements and/or failed to disclose that Enservco had defective disclosure controls and procedures and internal control over financial reporting. As a result, there were errors in Enservco’s financial statements relating to, inter alia, its transactions with Cross River Partners, a related party, and accounting for ERCs, a tax credit provided for under the CARES Act. Specifically, the Company improperly accounted for a conversion of debt to equity with Cross River Partners and “misinterpret[ed the] eligibility for certain employee retention tax credits under relevant provisions of the [CARES Act].” Accordingly, the Company would need to restate certain of its financial statements and delay the filing of its 2021 annual report with the SEC.
Ultimately, Enservco could not file its delayed 2021 annual report with the SEC within its initially represented timeline. A series of disclosures to the public and SEC regarding the delay negatively impacted the Company’s stock price.
Next Steps: If you acquired shares of Enservco Corporation (ENSV) securities between May 13, 2021 and April 19, 2022, you have until July 19, 2022, to ask the court to appoint you lead plaintiff for the class. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.