PhyCor, Inc. - Securities Class Action

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_______________
Copyright (c) 2001
Stanford Law School

PhyCor, Inc. Conclusion: According to the latest docket, on April 14, 2002, a Stipulation of Settlement was filed, and on April 22, 2002, the U.S. District Judge Todd J. Campbell preliminarily approved the settlement. The settlement hearing was set for July 26, 2002. At the hearing, Judge Campbell granted the motions for approval of the plan of allocation of the settlement and for approval of the application for an award of attorneys’ fees and reimbursement of expenses. Judge Campbell further issued the Order granting the motion for final approval of the settlement, the action was dismissed with prejudice, and the case was terminated.

As reported in a press release, stockholders of bankrupt PhyCor, Nashville, will receive 16 cents per share under settlement terms of a class-action lawsuit alleging that the company and its executives committed securities fraud and concealed information. The total payment to shareholders who purchased stock from April 22, 1997, to Sept. 22, 1998, will amount to $10 million, according to the agreement struck earlier this month in U.S. District Court in Nashville.

The original complaint names PhyCor and certain of the Company's officers and directors as defendants, alleging that these parties violated Sections 10(b) and 20(a) of the Exchange Act, as well as SEC Rule 10b-5 promulgated thereunder, by originating a series of materially misleading statements and omissions concerning the Company's acquisitions and operations during the Class Period. Plaintiff also alleges that PhyCor and its top executives falsified the Company's reported profits. Specifically, Plaintiff alleges, among other things, that the defendants misrepresented that the Company was successfully integrating the operations of various acquired companies, when, in fact, PhyCor was experiencing severe difficulties assimilating those acquisitions. In addition, Plaintiff alleges that PhyCor touted the Company's growth strategy and ability to achieve promised earnings per share, knowing that PhyCor lacked effective management structure and its business was failing. These misrepresentations and omissions had the aggregate effect of artificially inflating the share prices of PhyCor's stock, allowing PhyCor to continue its acquisition-based growth strategy and the Individual Defendants to sell their own stock for proceeds of more than $17 million. When defendants finally revealed the whole truth, that PhyCor could not grow at promised rates and would take another $65 million charge, PhyCor stock plummeted to $8-1/4, an almost 40% drop in one day.

NOTE: PhyCor and 48 of its subsidiaries filed for Chapter 11 bankruptcy protection in January 2002, listing about $29 million in assets and $339 million in liabilities.

INDUSTRY CLASSIFICATION:
SIC Code: 8011
Sector: Healthcare
Industry: Healthcare Facilities

COMPANY/ISSUER NAME:	PhyCor, Inc.
COMPANY/ISSUER TICKER:	PHYC [DELISTED]
COMPANY WEBSITE:	http://www.phycor.com/

FIRST IDENTIFIED COMPLAINT IN THE DATABASE

Meyer, et al. v. Hutts, et al.

COURT: M.D. Tennessee	DOCKET NUMBER: 98-CV-00834
JUDGE NAME: Magistrate Judge Joe B. Brown
DATE FILED: 09/09/1998	SOURCE: Internet
CLASS PERIOD START: 04/22/1997	CLASS PERIOD END: 07/22/1998
TYPE OF COMPLAINT: Unamended/Unconsolidated
PLAINTIFF FIRMS IN THIS OR SIMILAR CASE:
Barrett, Johnston & Parsley 217 Second Avenue, N, Nashville, TN, 37201 (voice) 615.244.2202, (fax) , Finkelstein, Thompson & Loughran 1050 30th Street, NW, Washington, DC, 20007 (voice) 202.337.8000, (fax) 202.337.8090, contact@ftllaw.com Stull, Stull & Brody (New York) 6 East 45th Street, New York, NY, 10017 (voice) 310.209.2468, (fax) 310.209.2087, SSBNY@aol.com Weiss & Yourman (New York, NY) The French Building, 551 Fifth Ave., Suite 1600, New York, NY, 10126 (voice) 212.682.3025, (fax) 212.682.3010, info@wyca.com Wirtz & Associates , , , (voice) , (fax) , _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 5

DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT
LEAD DOCKET FOR CASE #: 98-CV-834
Type: Docket		Date on the document: 08/17/1999

REFERENCE COMPLAINT

Meyer, et al. v. Hutts, et al.

COURT: M.D. Tennessee	DOCKET NUMBER: 98-CV-00834
JUDGE NAME: Hon. Todd J. Campbell
DATE FILED: 04/09/1999	SOURCE: Business Wires
CLASS PERIOD START: 04/22/1997	CLASS PERIOD END: 09/22/1998
TYPE OF COMPLAINT: First Amended and Consolidated
PLAINTIFF FIRMS NAMED IN COMPLAINT:
Barrett, Johnston & Parsley 217 Second Avenue, N, Nashville, TN, 37201 (voice) 615.244.2202, (fax) , Berger & Montague, P.C. 1622 Locust Street, Philadelphia, PA, 19103 (voice) 800.424.6690, (fax) 215.875.4604, investorprotect@bm.net Cauley, Geller, Bowman & Coates, LLP P.O. Box 25438, Little Rock, AR, 72221-5438 (voice) (501) 312-8500, (fax) , Milberg Weiss Bershad Hynes & Lerach LLP (San Diego, CA) 600 West Broadway, 1800 One America Plaza, San Diego, CA, 92101 (voice) 800.449.4900, (fax) , support@milberg.com _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 4

DOCUMENTS FOR THE REFERENCE COMPLAINT
Notice Of Pendency And Settlement Of Class Action
Type: Notice		Date on the document: 04/19/2002
Proof of Claim and Release
Type: Memorandum		Date on the document: 04/19/2002
U.S. District Court Civil Docket
Type: Docket		Date on the document: 07/03/2003

OTHER DOCUMENTS
Class Action Complaint for Violation of the Securities Exchange Act of 1934
Case Name and/or Number: D'Ambrosio, et al. v. Hutts, et al.
Type: Complaint		Date on the document: 10/06/1998
CIVIL DOCKET FOR CASE #: 98-CV-948
Case Name and/or Number: D'Ambrosio v. Hutts, et al.
Type: Docket		Date on the document: 12/01/1998
CIVIL DOCKET FOR CASE #: 98-CV-5642
Case Name and/or Number: Rosenwald, et al. v. Hutts, et al .
Type: Docket		Date on the document: 12/03/1998
CIVIL DOCKET FOR CASE #: 98-CV-1123
Case Name and/or Number: Rosenwald, et al. v. Hutts, et al .
Type: Docket		Date on the document: 01/12/1999

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