… And Izard Nobel …

The law firm of Izard Nobel LLP announces that a lawsuit seeking class action status has been filed in the United States District Court for the Eastern District of New York on behalf of purchasers of the common stock of FalconStor Software, Inc. between February 5, 2009 and September 29, 2010, inclusive.

The Complaint charges FalconStor and certain of its officers and directors with violations of federal securities laws.

Specifically, the Complaint alleges
that defendants misrepresented and/or failed
to disclose the following adverse facts:

• that the Company was experiencing weak demand for its products and services;
• that FalconStor was making improper payments to secure a contract with at least one of the Company’s customers; and
• as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about FalconStor and its prospects.

Then, on September 29, 2010, FalconStor announced that ReiJane Huai "resigned from all of his positions with the Company, effective immediately." The press release stated that Mr. Huai "tendered his resignation following his disclosure that certain improper payments were allegedly made in connection with the Company’s contract with one customer." On this news, shares of the Company’s stock fell $0.91 per share, or 22%, to close at $3.15 per share.