Last week, the ShengdaTech Liquidating Trust filed two lawsuits in the United States Bankruptcy Court for the District of Nevada seeking to recover on behalf of the creditors of ShengdaTech, Inc. The two complaints provide the most detailed allegations thus far arising out of the collapse of ShengdaTech, Inc. which ultimately led to the company’s 2011 bankruptcy filing. The complaints lay out a series of allegations relating to a massive fraudulent scheme in which certain of the company’s executives and largest shareholders allegedly looted the company of tens of millions of dollars.
In the first complaint, the ShengdaTech Liquidating Trust asserts claims against several firms which served as the company’s auditors in the years leading up to the bankruptcy filing. The defendants are Hansen, Barnett & Maxwell, P.C.; Baker Tilly International Limited; KPMG International Cooperative; and KPMG LLP. A copy of the complaint is embedded below.
In the second complaint, the ShengdaTech Liquidating Trust asserts claims against three individuals. The first defendant is Xiangzhi Chen, who was ShengdaTech’s President & CEO From March 2006 through August 2011 and also ShengdaTech’s largest shareholder (42.25%). The second defendant is Anhui Guo, who was ShengdaTech’s COO until April 29, 2011 and was ShengdaTech’s acting CFO prior to April 2009 and between September 2010 and April 29, 2011. The third and final defendant is Andrew Chen, who was ShengdaTech’s CFO from April 2009 to September 2010. A copy of the complaint is embedded below.