A class action has been filed in the U.S. District Court for the Southern District of New York against Oilsands Quest Inc. (AMEX: BQI) and certain of the Company's officers. The action for violations of the Securities Exchange Act of 1934 is brought on behalf of those purchasing the common stock and other publicly-traded securities of Oilsands Quest between August 14, 2006 and July 14, 2009, inclusive (the "Class Period"), including Oilsands Quest's "Exchangeable Shares" offered as consideration for the minority interest in OQI Sask on August 14, 2006; Oilsands Quest's "units" first publicly offered on December 5, 2007 at $5.00 per unit; Oilsands Quest common stock shares publicly offered on December 5, 2007 on a flow-through basis at $6.11 ($6.17 CDN) per share; and Oilsands Quest's "units" first publicly offered on May 1, 2009 at $0.85 per unit. The complaint filed in the action charges that, during the Class Period, Oilsands Quest and certain of its officers and directors overstated the value of the Company's assets by more than $136 million in violation of Generally Accepted Accounting Practices ("GAAP").
As alleged in the complaint, on August 14, 2006, Oilsands Quest acquired the minority interest in its operating subsidiary, OQI Sask, that the Company did not already own. The Complaint alleges that Oilsands Quest's Class Period financial reports and statements issued thereafter were false and misleading in that: (a) defendants failed to properly account for Oilsands Quest's acquisition of the minority interest of OQI Sask in August 2006, materially overstating the value of OQI Sask throughout the Class Period; (b) Oilsands Quest's financial statements overstated the value of the Company's interest in OQI Sask and were presented in violation of GAAP throughout the Class Period; and (c) contrary to defendants' Class Period assurances, the Company's internal controls were inadequate to prevent it from improperly inflating the value of its assets.
On July 14, 2009, the Company issued a release disclosing that the Company's FY 2007, FY 2008 and Q-1, Q-2 and Q-3 2009 financial reports should no longer be relied upon, that its previously issued financial reports would be restated, and that Oilsands Quest's internal controls were deficient throughout the Class Period. Meanwhile, the complaint alleges, as a result of defendants' false statements, Oilsands Quest's stock price traded at artificially inflated levels during the Class Period, trading as high as $6.75 per share on June 23, 2008, but that as the truth seeped into the market, the Company's shares were hammered by massive sales, sending them down 87% from their Class Period high.
If you are a current shareholder and purchased during the period August 14, 2006 and July 14, 2009, and would like to discuss your options of exercising your rights as a shareholder, please contact us.
Please submit the following information so we can determine if you qualify for the suit. If you don't know all the specific details, partial information is also acceptable.