WEST HARTFORD, CT -- (Marketwire) -- 01/16/12 -- The law firm of Izard Nobel LLP, which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the Eastern District of Missouri on behalf of purchasers of the common stock of CPI Corp. ("CPI" or the "Company") (NYSE: CPY) between April 20, 2010 and December 21, 2011, inclusive (the "Class Period").
The Complaint alleges that CPI and certain of its officers and directors violated the federal securities laws. Specifically, defendants concealed the following facts: (i) CPI's business was performing much worse than defendants acknowledged and was deteriorating; (ii) CPI's initiatives to grow the business were not working as represented; (iii) CPI's stock was not a "good investment" and the Company's stock buy-back was intended solely to project false confidence in the Company's prospects; and (iv) CPI's cash flows would continue to deteriorate due to poor revenue growth.
On December 22, 2011, CPI announced results for the fiscal quarter ended November 12, 2011. CPI reported a net loss of ($7.25) million and that net sales declined 11% to $95.0 million, due in significant part to the Company's comparable store sales declines. The results also meant that CPI had failed its leverage ratio test for its revolving credit facility. CPI had to obtain an amendment to its credit agreement. As a result, CPI will have to stop its dividend. On this news, CPI stock fell nearly 63%.
If you are a member of the class, you may, no later than March 13, 2012, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members.
While Izard Nobel LLP has not filed a lawsuit against the defendants, to view a copy of the Complaint initiating the class action or for more information about the case, and your rights, visit: www.izardnobel.com/cpicorp/, or contact Izard Nobel LLP toll-free: (800)797-5499, or by e-mail: firstname.lastname@example.org. For more information about class action cases in general, please visit our website: www.izardnobel.com.
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