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Federman & Sherwood Announces the Filing of a Securities Class Action Lawsuit against RCI Hospitality Holdings, Inc.

To join this class action, please complete the following Investor Certification.   [contact-form-7 id=”1167″ title=”RCI Hospitality Holdings, Inc. Investor Certification”]

Oklahoma City, OK (May 22, 2019) – On May 21, 2019, a securities class action lawsuit was filed in the United States District Court for the Southern District of Texas against RCI Hospitality Holdings, Inc. (NASDAQ: RICK).  The complaint alleges violations of federal securities laws, Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, including allegations of issuing a series of material or false misrepresentations to the market which had the effect of artificially inflating the market price during the Class Period, which is February 14, 2018 through May 10, 2019.  More specifically, the complaint filed alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that the Company engaged in numerous transactions with the CEO, including lending him significant sums of money; (2) that these practices were reasonably likely to lead to regulatory scrutiny of the Company; (3) that, as a result of investigations into the Company’s governance, the Company would be unable to timely file its financial statements; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially false and/or misleading and/or lacked a reasonable basis.

On December 11, 2018, RCI Hospitality stated that it could not timely file its annual report with the SEC due to “delays in completing the audit of its financial statements for the year ended September 30, 2018.”  On this news, the Company’s share price fell $1.37, or approximately 6%, to close at $22.33 per share on December 12, 2018, thereby injuring investors.

Then, on May 10, 2019, RCI Hospitality stated that it could not timely file its quarterly report with the SEC for the period ended March 31, 2019 due to pending investigations concerning negative articles published in mid- and late 2018 about the company.  On this news, the Company’s share price fell $1.67, or over 7%, to close at $20.48 per share on May 13, 2019, thereby injuring investors further.

Plaintiff seeks to recover damages on behalf of all RCI Hospitality Holdings, Inc. shareholders who purchased common stock during the Class Period and are therefore a member of the Class as described above.  You may move the Court no later than Monday, July 22, 2019 to serve as a lead plaintiff for the entire Class.  However, in order to do so, you must meet certain legal requirements pursuant to the Private Securities Litigation Reform Act of 1995.

If you wish to discuss this action, obtain further information and participate in this or any other securities litigation, or should you have any questions or concerns regarding this notice or preservation of your rights, please contact:  Robin Hester at rkh@federmanlaw.com

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