LJ International Inc., the leading jewelry manufacturer and retailer in China, based in Hong Kong and registered in the British Virgin Islands, announced that on January 14, 2009 it entered into a settlement agreement with the lead plaintiff in the class-action shareholder lawsuit against it.
The lawsuit covers all holders of BVI company’s common stock in the period from February 15, 2007 through September 6, 2007. In a complaint made in April 2008, plaintiffs had alleged that LJI had made material misstatements concerning its projected Q4 and year-end 2006 net income and earnings. LJI had denied all the claims alleged by the plaintiffs, and has agreed to the settlement just in order to eliminate litigation costs and time required for it.
Under the terms of the settlement agreement on the lawsuiit that was filed in 2007, LJI will create settlement fund of $2 mln, which will be funded entirely by its insurer. Also, all claims alleged in the lawsuit will be dismissed, and the BVI company will be released from liability for all of them.
The current settlement agreement is subject to preliminary and final approval by the Court, and the hearing for the preliminary approval is scheduled for February 23, 2009.