A lawsuit was filed on behalf of investors in Apollo Education Group Inc (NASDAQ:APOL) shares over alleged securities laws violations and NASDAQ:APOL investors should contact the Shareholders Foundation.
San Diego, CA -- (SBWIRE) -- 04/22/2016 -- A shareholder of Apollo Education Group Inc (NASDAQ:APOL) filed a lawsuit against Apollo Education Group Inc in the U.S. District Court for the District of Arizona over alleged Securities Laws violations.
Investors who purchased a significant amount of shares of Apollo Education Group Inc (NASDAQ:APOL) between June 26, 2013 and October 21, 2015 have certain options and for certain investors are short and strict deadlines running. Deadline: May 13, 2016. NASDAQ:APOL investors should contact the Shareholders Foundation at firstname.lastname@example.org or call +1(858) 779 - 1554.
The plaintiff claims that between June 26, 2013 and October 21, 2015 Apollo Education Group Inc reported generating billions of dollars in revenues while concealing that a substantial portion of those revenues were being derived through improperly aggressive recruiting tactics being undertaken at U.S. military bases across the country that contradicted an Executive Order signed into law by President Barrack Obama on April 27, 2012.
The plaintiff says that the express intent of the Executive Order, which had been implemented in large part by the spring of 2013, was to stop for-profit secondary education providers like the University of Phoenix from continuing to take advantage of present and former members of the U.S. military.
The plaintiff claims that Apollo Education Group's improperly aggressive recruiting tactics also allegedly violated the express terms of the contractual agreements the Company had entered into with the U.S. Department of Defense ("DoD") in February 2012 and July 2014 to permit the University of Phoenix to continue to participate in the DoD's tuition assistance programs.
The plaintiff furthermore alleges that between June 26, 2013 and October 21, 2015, the Defendants also concealed that efforts to transition Apollo Education Group's online classroom platform to a new "industry-leading private cloud infrastructure, offering enhanced scalability, reliability and performance," were failing because, unbeknownst to investors, from its inception the new platform was not functioning as designed due to software compatibility problems that prevented students from signing onto their online courses, which had dramatically increased student drop-out rates.
The plaintiff says that adding insult to injury, in addition to repeatedly minimizing the true extent of the software compatibility problems, even when later being questioned about them by stock analysts, Defendants hid from the investment community the deleterious impact the software compatibility problems were having not only on retention rates but on new student enrollment.
On January 8, 2015, Apollo Education Group Inc announced that its conversion to the new online platform was more challenging than had been anticipated and had resulted in a greater than expected impact on retention.
On March 25, 2015 Apollo Education Group Inc disclosed that it had experienced a significant disruption with respect to the new online classroom platform that was not only adversely impacting retention but had decreased enrollment by 13% in the quarter, forcing Apollo Education Group Inc to cut its annual revenue forecast, the stock price declined significantly.
Then, on June 30, 2015, the Center for Investigative Reporting ("CIR") published an exposé entitled "University of Phoenix sidesteps Obama order on recruiting veterans." In its exposé, CIR detailed how the University of Phoenix was violating President Obama's Executive Order, as well as the contractual agreements the University of Phoenix had entered into with the DoD, through a variety of improperly aggressive recruiting tactics.
That same day U.S. Senator Richard J. Durbin sent a letter to Secretary of Defense Ashton Carter bringing the matters raised in the CIR exposé to his attention and calling for the military to investigate and put an end to the illicit recruiting tactics.
When the DoD formally placed the University of Phoenix on probation on October 7, 2015, and banned it from recruiting on military bases and prevented troops from using federal funds for its classes, the price of Apollo Education Group Inc common stock plunged.
On October 22, 2015 Apollo Education Group Inc disclosed that its fourth quarter and fiscal year 2015 results had been negatively impacted and that its future results would continue to be negatively impacted by actions the Company had been forced to take to bring its operations into compliance with the law.
Though Apollo Education Group Inc has since reported that the DoD lifted the ban on troops using federal funds for University of Phoenix courses, the University of Phoenix remains on formal probation with the DoD and under intense scrutiny, and Apollo Education Group Inc has agreed to sell itself to a private equity fund for $9.50 per share.
Those who purchased shares of Apollo Education Group Inc (NASDAQ:APOL) have certain options and should contact the Shareholders Foundation.
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