NEW YORK - (NewMediaWire) - September 30, 2020 - Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Genius Brands International, Inc. (“Genius” or the “Company”) (NASDAQ:GNUS) of the October 19, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you invested in Genius stock or options between March 17, 2020 and July 5, 2020 and would like to discuss your legal rights, click here: www.faruqilaw.com/GNUS. There is no cost or obligation to you.
You can also contact us by calling Richard Gonnello toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to email@example.com.
FARUQI & FARUQI, LLP
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Attn: Richard Gonnello, Esq.
Telephone: (877) 247-4292 or (212) 983-9330
The lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of all those who purchased Genius securities between March 17, 2020 and July 5, 2020 (the “Class Period”). The case, Salvador Verdin v. Genius Brands International, Inc. et al, No. 20-cv-07457 was filed on August 18, 2020, and has been assigned to Judge Dean D. Pregerson.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by making false and/or misleading statements regarding: (1) Nickelodeon’s purported broadcast expansion of Genius’s Rainbow Rangers cartoon; (2) subscription fees for the Kartoon Channel!; and (3) the Company’s growth potential and overall prospects as a company. While the share price of Genius stock was artificially inflated due to these misstatements, Genius registered for sale tens of millions of shares, allowing certain longtime investors to cash out at the expense of Plaintiff and the Class.
Specifically, on June 5, 2020, following the massive hype and pump of Genius stock, Hindenburg Research published a report titled “A Bagholder’s Guide to Why We Think Genius Brands Will Be a $1.50 Stock Within a Month” (the “Hindenburg Research Report” or “Report”). This report questioned the valuation of Genius and highlighted inaccurate public statements made by Genius. With respect to Genius’s Rainbow Rangers intellectual property, the Hindenburg Research Report showed that Rainbow Rangers was actually airing nine times per week, rather than the 26-airings figure noted in Genius’ press release. Moreover, the episodes were not airing in favorable time slots and were, instead, being broadcast daily at 3:49 a.m. and then twice additionally on Sunday mornings at 6:00 a.m. and 6:30 a.m.
On this news, Genius’s stock fell from a closing price of $6.86 per share on June 4, 2020 to $5.94 per share on June 5, 2020—a $0.92 or 12.41% drop.
Then, on June 16, 2020 Genius announced the slate of content for Kartoon Channel! and investors began to realize that the Kartoon Channel! was not going to be the new Netflix for Kids, and was just another app in a crowded space.
On this news, Genius’s stock fell from a closing price of $4.52 per share on June 15, 2020 to $3.85 per share on June 16, 2020—a $0.67 or 14.82% drop.
Then, on July 6, 2020, Genius issued another exaggerated press release whereby Genius announced the creation of a joint venture with POW! Entertainment regarding the intellectual property that Stan Lee created after his time at Marvel Entertainment. Defendant Heyward outrageously stated that “[t]he potential value in this single asset, is greater than any IP anywhere in Hollywood.” With these exaggerated statements, investors realized that the gig was up and that there was little substance behind the hype.
On this news, Genius’s stock fell from a closing price of $3.55 per share on July 02, 2020 to $2.66 per share on July 06, 2020—a $0.89 or 25.07% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Genius’s conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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