Arthrocare – The Smoking Gun

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UPDATE May 30, 2008 – Arthrocare wins the Frost & Sullivan award for deception.

On May 29, Arthrocare announced that it had been awarded the Frost & Sullivan award for product innovation for the Opus Twin Lock system.  The company was so proud that they proclaimed:

“Were very excited about our TwinLock Knotless Fixation System being recognized by Frost & Sullivan for this prestigious award, said Jack Giroux, president of ArthroCare Sports Medicine. The device is designed to dramatically simplify the most challenging rotator cuff repairs by providing a dual implant system that can be placed and tensioned by the surgeon in secondsdirectly through the rotator cuff. In terms of acceptance and demand from surgeons, the system has already exceeded expectations. This Award is icing on the cake. Its a great honor.

What they forgot to mention is – THE AWARD IS A SCAM!

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More Explanation of the Fraud at Emcore (Nasdaq:EMKR)

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It has not been a great month for Emcore. 

May 5:  The company puts out a fraudulent press release announcing an order of $28 million by a customer who has no verifiable projects or funding.

May 7:  Emcore publicly disclosed in a form 8-K that the business unit acquired from Intel lost $100 million with -20% gross margins and declining revenues.  (Did they pay Intel or did Intel pay them to take these assets?)

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Emcore (NASDAQ:EMKR) – Citron Calls Fraud.

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The SEC and NASDAQ must investigate Emcore management’s claims about the validity of this purported order from ES Systems.

When you stack up management’s claims vs. the facts to make an investment decision, two starkly different versions of reality have to be weighed.  One version requires believing Emcore’s management.  The other version has you looking squarely in the face of corporate fraud.

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American Superconductor (AMSC): Someone has a lot of explaining to do!

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This past week, Wall Street whooped up the higher top-line revenue number from American Superconductor (NASDAQ:AMSC), and rewarded it with an immediate 25%, plumping its market cap to well over a billion dollars.  All this for a company that has done nothing but over promise and under deliver for years.

Citron seeks to answer a key question:  Was this increase in revenue gained through legitimate arms-length transactions, or was there another explanation – some undisclosed related party transactions? …  You be the judge.  If we look to the insiders for guidance, they have already rendered their verdict, in the form of insider selling at a furious pace.  Read on and enjoy a true tale of Wall St.

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Citron Updates Arthrocare

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Arthrocare- “Something is rotten in the state of Denmark”
William Shakespeare

Last week Arthrocare announced its quarterly results.  They led with a PR touting surprisingly high year over year growth numbers.  Notably, the announcement was in the form of an 8-K – only including the numbers the company wanted investors to see.  All the financial details provided by a 10-Q, such as divisional breakout of revenues, cash flow, receivables aging, etc. are still AWOL

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