Robbins Umeda LLP Announces an Investigation of the Princeton Review, Inc.
Robbins Umeda LLP, a shareholder rights litigation firm, has commenced an investigation into possible breaches of fiduciary duty and other violations of the law by certain officers and directors at the Princeton Review, Inc. (NASDAQ: REVU). Princeton Review provides in-person, online, and print educational products and services for high school and post-secondary school markets. The company was founded in 1981 and is headquartered in Framingham, Massachusetts.
Robbins Umeda LLP’s investigation focuses on whether the directors and officers of Princeton Review harmed the company by breaching their fiduciary duties to shareholders. In particular, Robbins Umeda LLP is investigating whether company fiduciaries made improper statements about Princeton Review’s financial condition and future business prospects. For example, during the tenure of Chairman and Chief Executive Officer Michael Perik, Princeton Review executives routinely issued statements to the investing public that failed to reflect adverse facts about the company’s revenue and earnings, the growing competition from low price competitors, and the true nature of the company’s turn-around strategy. Additionally, the firm is focusing on the decision by executives to shift Princeton Review’s emphasis from core businesses to the pursuit of unproven projects to the detriment of the company.
On March 9, 2011, Michael Perik resigned as CEO of Princeton Review, and the company announced financial results for the fourth quarter and full year 2010. These figures demonstrated losses from continuing operations that totaled $50.4 million, compared to $13.9 million in losses for 2009. Following these announcements, the price of the company’s stock lost 37.80% of its value, to close at $0.51 on March 10, 2011. This downward spiral would continue, with shares of Princeton Review stock declining an additional 23.53% to close at just $0.39 per share on March 11, 2011.
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