protection, and other financially-oriented subjects.” Whitney also develops and sells
educational resource materials and “mentoring” and “coaching” services. Founded in
1992 as Gimmel Enterprises, Inc., the Company changed its name to WIN Systems
International, Inc. in 1998 and, in 1999, changed its name yet again, this time to
Whitney Information Network, Inc. See CAC at ¶ 4.
Defendant Russell A. Whitney (“Russ Whitney”), the Company’s founder, was,
during the Class Period, Chairman and Chief Executive Officer of the Company.
Plaintiff says that he made and/or was responsible for materially false and
misleading statements and omissions in Whitney SEC filings, press releases,
conference calls with analysts, and on the Company’s website. Plaintiff also alleges
that Russ Whitney signed the Company’s SEC filings, including but not limited to
Whitney’s Forms 10-Q and Form 10-K and the Registration Statements filed with the
SEC in connection with the Company’s PIPE (i.e., private investment in public equity)
Registration in November 2006 and its aborted spin-off Registration of EduTrades, the
Company’s stock trading educational subsidiary. During the Class Period, Russ
Whitney liquidated $5,626,000 worth of shares in connection with the Company’s $13.5
million PIPE transaction and another $950,000 worth of additional shares of his
personally-held Whitney common stock. See CAC at ¶ 5.
Defendant Ronald S. Simon (“Simon”) was Executive Vice President and
Acting Chief Financial Officer until January 25, 2006. Simon was then President and
Chief Operating Officer of the Company until his resignation effective December 5,