Gilman Law LLP, A National Law Firm Representing Victims of Securities Fraud, Announces Shareholder’s Securities Fraud Class Action Lawsuit Filed Against Career Education Corporation
Gilman Law LLP, a leading national securities law firm, is actively investigating shareholder allegations that Career Education Corporation (“Career Education”, “CEC” or the “Company”) and certain of its officers and directors made materially false and misleading statements or failed to disclose material information related to the company’s business and operations in violation of Section 10(b) and 20(a) of the Securities Exchange Act of 1940 and Rule 10-5 promulgated thereunder.
If you purchased or otherwise acquired the common stock of Career Education Corporation (NASDAQ: CECO) during the period between January 1, 2009 and November 1, 2011, inclusive (the “Class Period”) and either lost money on the transaction or still hold the shares, you may contact Gilman Law LLP by March 13, 2012 to discuss your rights, including as to recovery of your losses or to obtain additional information.
CEC is one of the largest for-profit providers of education services in the United States and Europe and operates more than 90 schools offering degrees in a wide variety of subjects. Career Education advertises that its schools offer “high quality education to a diverse student population of more than 116,000 in a variety of career-oriented disciplines through on-line, on ground and hybrid learning offerings.” The Company’s stated mission is premised on its belief “that individuals, to compete successfully in today’s demanding workplace, benefit significantly from a solid education that provides them with the foundation of knowledge and skills they can use on the job and to build meaningful careers.”
The shareholder class action lawsuit was filed in the United States District Court for the Northern District of Illinois United States District Court for the Northern District of Illinois after certain key Company senior executives resigned and Career Education stock plummeted almost 50%. Shareholders allege that throughout the Class Period, Career Education represented that its retention rates and employment or “placement rates” following graduation were higher than they actually were. The Complaint alleges that the positive statements made by the Company were materially false and misleading when made, and were known to be false and misleading because the Company failed to disclose that the Company’s purported Placement rates were achieved through an improper course of conduct and a manipulative use of the term “employment.”
On May 24, 2011, CEC filed a Form 8-K with the Securities and Exchange Commission disclosing that Career Education Corporation received from the Attorney General of the State of New York a Subpoena Duces Tecum dated May 17, 2011, relating to the Attorney General’s investigation of whether the Company and certain of its academic institutions have complied with certain New York state consumer protection, securities, finance and other laws. Pursuant to the Subpoena, the Attorney General requested from the Company and certain of its academic institutions documents and detailed information on a broad spectrum of business practices for the time period May 17, 2005 to the present.
Subsequently on August 3, 2011, the Company filed a Form 8-K with the Securities and Exchange Commission accompanied by a press release announcing that Career Education Corporation identified improper practices at certain of its health education segment campuses relating to the determination of reported placement rates. Career Education’s Board of Directors directed outside independent legal counsel Dewey & LeBoeuf to undertake a thorough investigation of these practices. In addition, independent counsel was directed to review the determination of student placements at all of the company’s domestic schools.
In response to the news of the investigations and the resignation of certain key Company senior executives, CEC stock dropped to $8.40 per share at close on November 2, 2011, almost a 50% drop from the previous day’s close of $15.95 per share, on a very heavy trading volume.
For over 40 years, the lawyers at Gilman Law have extensive experience representing both individual and institutional investors in securities have been involved in all major aspects of securities fraud litigation. The firm specializes in cases involving stock manipulation, securities fraud, and shareholder rights violations. Gilman Law is ready to assist investors nationwide who have sustained losses as a result of Career Education’s alleged fraud. For a free evaluation of your case, call TOLL FREE at (888) 252-0048.