NEW YORK, July 22, 2008 (PRIME NEWSWIRE) -- The Rosen Law Firm today announced that it has commenced an investigation into allegations that ArthroCare Corp. ("ArthroCare" or the "Company") (Nasdaq:ARTC) violated the federal securities laws by improperly recognizing revenue from certain sales in violation of Generally Accepted Accounting Principles ("GAAP").
On July 21, 2008, the Company announced it will restate its financial statements for the fiscal years 2006 and 2007 and first quarter of 2008 because it had recorded revenue from sales to certain entities in violation of GAAP. The Company estimates that the restatement will require a non-cash reduction of revenue of $4.0 million to $7.0 million in 2006, $20 million to $25 million in 2007 and $2.0 million to $5.0 million in Q1 2008. News of the restatement resulting from the improper revenue recognition practices caused ArthroCare's stock price to plunge, inflicting substantial losses on investors.
As a result of these allegations, the Rosen Law Firm is preparing a class action lawsuit on behalf of investors who purchased ArthroCare stock during the period from May 3, 2006 through and including July 21, 2008.
You may access the website at http://www.rosenlegal.com to participate in the proposed class action.
If you purchased ArthroCare securities and would like further information concerning your legal rights, please contact Laurence Rosen, Esq. or Phillip Kim, Esq. toll-free at 866-767-3653 or email lrosen@rosenlegal.com or pkim@rosenlegal.com or visit the website at www.rosenlegal.com
The Rosen Law Firm has expertise in prosecuting investor securities litigation and extensive experience in actions involving financial fraud. The Rosen Law Firm represents investors throughout the nation, concentrating its practice in securities class actions.