HARTFORD, Conn., Dec. 31, 2007 (PRIME NEWSWIRE) -- The law firm of Schatz Nobel Izard P.C., 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 Central District of California on behalf of all persons who purchased the common stock of Basin Water, Inc. ("Basin" or the "Company") (Nasdaq:BWTR) between May 14, 2007 and November 13, 2007, inclusive (the "Class Period"). Also included are those who received Basin shares as a result of the acquisition of Mobile Process Technology Co.
The Complaint alleges that Basin and certain of its officers and directors violated federal securities laws by concealing the following facts: (i) Basin failed to properly account for its reserves for its legacy system contracts related to its system sales and water service agreement contracts; (ii) the unprofitable legacy business would continue to weigh on Basin's results as the Company was having difficultly reworking its unfavorable legacy contracts; (iii) defendants' statements that by the end of the second quarter of 2007 the Company had largely completed its internal operational transition of its business practices and processes and had resolved the bulk of the issues concerning its legacy contracts were false; and (iv) Basin lacked requisite internal controls to ensure reserves for its legacy contracts were properly accounted for.
On November 14, 2007, Basin reported its financial results for the quarter ended September 30, 2007, and announced a $4.7 million charge to cost of revenues to reserve for future projected losses. The reserve was due primarily to poorly priced contracts, increasing waste disposal and salt purchase costs and the inability to contractually pass increased costs on to the Company's clients. On this news, Basin's stock declined $2.29 per share to close at $8.01 per share.
If you are a member of the class, you may, no later than February 25, 2008, 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, including decisions concerning settlement. The securities laws require the Court to consider the class member(s) with the largest financial interest as presumptively the most adequate lead plaintiff(s).
While Schatz Nobel Izard P.C. 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, class action cases in general, and your rights, please contact Schatz Nobel Izard P.C. toll-free at (800) 797-5499, or by e-mail at firm@snilaw.com, or visit our website: www.snilaw.com.