Isilon Systems, Inc.Cohen Milstein is lead counsel in a lawsuit in the United States District Court for the Western District of Washington on behalf of its client and on behalf of other similarly situated persons or entities who purchased or otherwise acquired the common stock of Isilon Systems, Inc. (“Isilon” or the "Company") between December 14, 2006 and November 8, 2007, inclusive (the “Class Period”), against Isilon and certain of its officers, directors and affiliates for violations of the Securities Exchange Act of 1934, and on behalf of all persons or entities who acquired the common stock of Isilon pursuant and/or traceable to the Company’s false and misleading amended Registration Statement and Prospectus issued in connection with its initial public offering (the "IPO"), for violations of the Securities Act of 1933. On April 18, 2008, Cohen Milstein filed a Consolidated Class Action Complaint, alleging that prior to and throughout the Class Period, Defendants engaged in revenue manipulation to artificially inflate Isilon’s revenue. This revenue manipulation in turn enticed investors to purchase Isilon securities both during and after the IPO, artificially driving up the price of Isilon’s common stock. However, as the end of each successive quarter of the Class Period approached, it became increasingly difficult for the Defendants to maintain the charade of their reported artificially-inflated revenue since revenue that should have been recognized in current quarters had already been improperly recognized in prior quarters. Ultimately, the Defendants no longer were able to maintain the sham, and in the Fourth Quarter of 2007 were forced to reveal that they no longer could manufacture enough fictitious revenue to meet expectations and would be forced to launch an internal investigation into the Company’s wrongful revenue recognition practices. This investigation led to the April 2, 2008 restatement of Isilon’s Class Period financial statements. As the truth of Defendants’ revenue manipulation leaked out to the marketplace and the risks associated with this revenue manipulation materialized, the artificial inflation of Isilon’s share price was removed, causing Isilon’s stock price to drop and damaging investors who had purchased Isilon shares when the price was artificially-inflated. |
