Bidz Calls Lawsuit "Without Merit"

By JCK Online Staff -- JCK Online, 5/11/2009 2:03:00 PM

Internet jewelry seller Bidz.com said in a statement it will defend itself aggressively against a lawsuit filed by Ramon Gomez in the United States District Court, Central District of California, against Bidz.com and its chairman and chief executive officer, David Zinberg.

The complaint was filed as a purported class action on behalf of all purchasers of the common stock of Bidz.com between August 13, 2007 to November 26, 2007.

The plaintiff's allegations are solely based on a report published by Citron Research on November 26, 2007, the statement said. After issuing the report, Citron Research, previously known as StockLemon.com, publicly acknowledged that it held a short position in the common stock of Bidz.com, Inc. The Company has publicly refuted all the claims made in the report

Bidz states that the class action complaint is the latest in a series of allegations against Bidz.com in the aftermath of the Citron Report, including complaints made to the Securities and Exchange Commission and the Federal Trade Commission.

For more on the Citron/Bidz controversy, see article: "Bidz: The Next Blue Nile?"

Bidz.com also disclosed an investigation by the Securities and Exchange Commission and has recently received a Civil Investigative Demand for information from the Federal Trade Commission relating to email marketing practices. Bidz.com is cooperating and responding to these investigations, the company said.

The statement concludes that Bidz.com believes the plaintiffs' claims are entirely without merit and intends to defend the action vigorously.