Rigrodsky & Long, P.A. announces that a class action lawsuit has been filed in the United States District Court for the Southern District of New York on behalf of all persons or entities who purchased, including purchasers of common stock, call options, and/or sellers of put options of China North East Petroleum Holdings Limited (“China North East” or the “Company”) (AMEX: NEP) between August 14, 2009 and May 26, 2010, inclusive (the “Class Period), seeking to pursue remedies under the Securities Exchange Act of 1934 (the “Complaint”).

Are you affected?

• Did you purchase China North East Petroleum Holdings Limited stock during the Class Period of 8/14/2009 - 5/26/2010?
• Did you lose money in your investment during the Class Period?
• Do you want to discuss your rights?

Rigrodsky & Long, P.A. announces that a class action lawsuit has been filed in the United States District Court for the Southern District of New York on behalf of all persons or entities who purchased, including purchasers of common stock, call options, and/or sellers of put options of China North East Petroleum Holdings Limited (“China North East” or the “Company”) (AMEX: NEP) between August 14, 2009 and May 26, 2010, inclusive (the “Class Period), seeking to pursue remedies under the Securities Exchange Act of 1934 (the “Complaint”).

The Complaint names China North East and certain of the Company’s executive officers and directors.  The Complaint alleges that during the Class Period, defendants made false and/or misleading statements and/or failed to disclose the truth concerning the Company’s financial statements.  On March 8, 2010, China North East disclosed that the Company had determined that its financial statements for the year ended December 31, 2008, and each interim quarter within that year, and for the quarters ended March 31, 2009, June 30, 2009 and September 30, 2009 should no longer be relied upon and should be restated as a result of certain non-cash errors contained therein regarding the accounting for: (i) warrants issued in conjunction with a secured debenture on February 28, 2008, which warrants should have been classified according to Emerging Issues Task Force 00-19 as liability instruments rather than equity instruments; (ii) the change in the fair value of those warrants from the date of issuance through the end of the reporting period; (iii) effective interest expense arising from amortization of the discount to the carrying value of the secured debenture; (iv) the recording of warrants issued to investment consultants in connection with the secured debenture as deferred financing costs instead of consulting fees; (v) the amount of amortization of deferred financing costs associated with the issuance of that secured debenture; (vi) amounts payable to a consultant included in accrued liabilities; (vii) compensation issued to employees in the form of stock; (viii) depreciation, depletion and amortization of oil producing properties; (ix) ceiling test reduction of the net carrying value of oil producing properties; (x) income tax expense for the above items; and (xi) minority interests for certain of the above items.

Subsequently, on May 27, 2010, the China North East issued a press release, announcing that the Company’s stock had been halted by the AMEX because of non-compliance with AMEX’s listing criteria.  China North East stock has not resumed trading since that time.  Furthermore, the Company also disclosed the resignation of the Company’s Chairman of the Board, CFO, a director, and the placement of the CEO on administrative leave pending the outcome of the current forensic audit.  The forensic audit preliminarily found that in 2009, cash transfers occurred between the bank accounts of the Company and its subsidiaries and the personal bank accounts of Hongjun Wang, the Company’s CEO, and Guizhi Ju, a Company director and mother of Hongjun Wang.

If you wish to serve as lead plaintiff, you must move the Court no later than August 10, 2010.  A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.  If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Timothy J. MacFall, Esquire or Noah R. Wortman, Case Development Director of Rigrodsky & Long, P.A., 919 North Market Street, Suite 980 Wilmington, Delaware, 19801 at (888) 969-4242, or by e-mail to info@rigrodskylong.com.  In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class.  Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff.  Any member of the purported class may move the court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

While Rigrodsky & Long, P.A. did not file the Complaint in this matter, the firm, with offices in Wilmington, Delaware and Garden City, New York, regularly litigates securities class, derivative and direct actions, shareholder rights litigation and corporate governance litigation, including claims for breach of fiduciary duty and proxy violations in the Delaware Court of Chancery and in state and federal courts throughout the United States.

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