Ho v. Duoyuan Global Water, Inc.
Lead Plaintiffs and others commenced a class action against Duoyuan Global Water, Inc. (DGW), its management, directors, underwriters, auditors, and GEF for violations of the Securities Act of 1933 and the Securities Exchange Act of 1934. Plaintiffs alleged material misrepresentations and omissions in DGW's SEC filings and press releases, leading to a decline in stock value and significant financial injury. Defendants moved for dismissal of the corrected amended complaint on various grounds, including insufficient pleading and statute of limitations. The court denied motions to dismiss several claims against DGW, CEO Wenhua Guo, and CFO Stephen C. Park, specifically regarding false financial statements and scienter. However, motions to dismiss against the external auditor Grant Thornton International, several individual directors, and the GEF defendants were granted due to lack of direct liability, control, or agency.