Plaintiffs, by their attorneys, for their Class Action Complaint (the "Complaint"), allege the following upon personal knowledge as to themselves and to their own acts and upon information and belief as to all other matters, based in part upon the investigation of Plaintiffs attorneys, including, among other things, the review and analysis of public statements, publicly-filed documents of Videolan Technologies, Inc. ("Videolan" or the "Company"), press releases and news articles.

1. This is a securities class action on behalf of public investors who purchased the common stock or warrants (collectively, the "Securities") of Videolan during the period from November 7, 1995 through May 28, 1996 (the "Class Period"). This case involves false representations made by the Defendants to the investing public that Videolan had entered into an agreement with the Samsung Corporation of Korea ("Samsung") under which Samsung committed to purchase from Videolan between $50,000,000 and $70,000,000 worth of Videolan's VL 2000 product (the "Samsung Agreement"), when, in fact, the Samsung Agreement did not obligate Samsung to purchase anything from Videolan. Defendants' misrepresentations regarding the Samsung Agreement created the illusion that Videolan was on the brink of reaping substantial revenues and earnings from the VL 2000. The misrepresentations caused the price of Videolan's stock to increase dramatically, and the price remained artificially inflated throughout the Class Period, thereby causing damage to those who bought the Securities during the Class Period (the "Class Members").

2. This Court has jurisdiction over this action pursuant to Section 27 of the Securities Exchange Act of 1934 (the "Exchange Act"), 15 U.S.C. § 78aa, and 28 U.S.C. §§ 1331 and 1337. The claims asserted herein arise under Sections 10(b) and 20 of the Exchange Act, 15 U.S.C. §§78j(b), and 78t, and Rule 10b-5, 17 C.F.R. §240.10b-5, promulgated thereunder by the Securities and Exchange Commission (the "SEC").

3. Venue is proper in this District pursuant to Section 27 of the Exchange Act, 15 U.S.C. §78aa, and 28 U.S.C. §1391(b). Videolan is headquartered in this District in Louisville, Kentucky, and many of the acts giving rise to the violations complained of, including the dissemination of false and misleading public statements, occurred in this District.

4. In connection with the wrongs alleged herein, Defendants used the instrumentalities of interstate commerce, including the United States mails, interstate wire and telephone facilities, and the facilities of the national securities markets.

5. Plaintiff Brent Berti purchased Videolan Securities during the Class Period and was damaged thereby, as set forth in the accompanying Certification of Named Plaintiff.

6. Plaintiff Steven Shaw purchased Videolan Securities during the Class Period and was damaged thereby, as set forth in the accompanying Certification of Named Plaintiff.

7. Defendant Videolan is a Delaware corporation with its headquarters at 100 Mallard Creek Road, Suite 250, Louisville, Kentucky. Defendant Videolan concluded its initial public offering in August 1995 (the "IPO") by issuing approximately 2,875,000 units at a price of $4.00, each of which consisted of one share of common stock and one redeemable common stock purchase warrant (the "warrants") exercisable for the purchase of one share of common stock at any time until August 10, 2000 at an exercise price of $7.00. The common stock and warrants traded separately throughout the Class Period.

8. At all times relevant to this action, Defendant Ted Ralston ("Ralston") was the Chairman of Videolan's Board Of Directors.

9. At all times relevant to this action, Defendant Steven Rothenberg ("Rothenberg") was the Vice President Finance, Chief Financial Officer and Treasurer of Videolan. From January 1996 through the end of the Class Period, Rothenberg was a member of Videolan's Board of Directors.

10. From September 1, 1995 until his resignation on January 17, 1996, Defendant John E. Haines ("Haines") was Videolan's Chief Executive Officer. From September 1, 1995 to May 14, 1996, Haines was a member of the Company's Board of Directors.

11. Defendant Vernon Jackson ("Jackson") was President of Videolan from May 1994 to January 1996. At all times relevant hereto, Jackson was a member of Videolan's Board of Directors.

12. At all times relevant to this action, Defendant Peter Beck ("Beck") was employed as Videolan's Chief Operating Officer.

13. Defendants Ralston, Rothenberg, Haines, Jackson and Beck shall be collectively referred to in this Complaint as the "Individual Defendants".

14. As officers, directors and/or controlling persons of a company which is registered with the SEC under the federal securities laws, whose common stock and warrants are registered with the SEC, traded on the National Association of Securities Dealers' Automated Quotation (over-the-counter) market ("NASDAQ") and governed by the provisions of the federal securities laws, the Individual Defendants had a duty to disseminate promptly accurate and truthful information with respect to the Company and its business, and to correct any previously issued statements from any source which were materially misleading or untrue, so that the market price of the common stock and warrants would be based upon truthful and accurate information. The Defendants' representations during the Class Period violated these specific requirements and obligations.

15. Plaintiffs bring this action as a class action pursuant to Rule 23 of the Federal Rules of Civil Procedure, individually and on behalf of all other persons or entities who purchased the common stock or warrants of Videolan during the Class Period defined above and were damaged thereby, excluding the Defendants herein, their affiliates and any officers or directors of Videolan or its affiliates, and any members of immediate families and their heirs, successors and assigns (the "Class").

16. The Class is so numerous that joinder of all the members of the Class is impracticable. As of March 10, 1996, approximately 13,864,498 shares of Videolan common stock and 3,139,000 Videolan warrants were outstanding. Videolan stock and warrants were actively traded on the NASDAQ during the Class Period under the symbols VLNT and VLNTW, respectively. Plaintiffs estimate that there are hundreds, if not thousands, of members of the Class located throughout the United States.

17. Common questions of law and fact exist as to all members of the Class and predominate over any questions affecting solely individual members of the Class. These questions include, but are not limited to, the following:

(a) whether Defendants' conduct as alleged herein violated the federal securities laws;

(b) Whether Defendants participated directly or indirectly in the concerted action or common course of conduct complained of herein;

(c) whether Defendants' press releases and statements disseminated to the investing public during the Class Period contained misrepresentations regarding the Samsung Agreement;

(d) whether the Defendants acted knowingly or recklessly in omitting and/or misrepresenting material facts regarding the Samsung Agreement ;

(e) whether the market price of Videolan common stock and warrants was artificially inflated during the Class Period; and

(f) whether the members of the Class have been damaged, and if so, what is the proper measure of damages.

18. Plaintiffs' claims are typical of the claims of the other members of the Class, because the damages suffered by Plaintiffs and all Class Members arise from and were caused by the same false and misleading representations and omissions made by or chargeable to Defendants. Plaintiffs do not have interests antagonistic to, or in conflict with, the Class.

19. Plaintiffs will fairly and adequately protect the interests of the Class. Plaintiffs have retained counsel competent and experienced in class and securities litigation to further ensure such protection and intend to prosecute this action vigorously.

20. A class action is superior to other available methods for the fair and efficient adjudication of the controversy. The Class is so numerous and geographically dispersed that it would be impracticable for each member of the Class to bring a separate action. The individual damages of any member of the Class may be relatively small when measured against the potential costs of bringing this action, and thus make the expense and burden of this litigation unjustifiable for individual actions. In this class action, the Court can determine the rights of all members of the Class with judicial economy.

21. Plaintiffs do not anticipate any difficulty in the management of this suit as a class action. The names and addresses of the record owners of the shares of Videolan's common stock and warrants purchased during the Class Period are available from the Company's transfer agent. Notice can be provided to such record owners and all class members by a combination of published notice and first-class mail using techniques and a form of notice similar to those customarily used in class actions arising under the federal securities laws.

22. Plaintiffs and the Class will rely, in part, upon the presumption of reliance established by the fraud-on-the-market doctrine in that, among other things:

(a) Videolan common stock and warrants met the requirements for listing, and were listed, on the NASDAQ, a highly efficient and automated market;

(b) The trading volumes of the Company's common stock and the warrants were substantial, reflecting numerous trades each day;

(c) Defendants made public statements, including press releases, which directly affected the market price of Videolan common stock and warrants;

(d) The omissions and misrepresentations were material;

(e) The misrepresentations alleged would tend to induce a reasonable investor to misjudge the value of the Company's common stock and warrants; and

(f) Plaintiffs and the other members of the Class purchased Videolan common stock and warrants without knowledge of the omitted and misrepresented facts.

23. Based upon the foregoing, Plaintiffs and the other members of the Class are entitled to a presumption of reliance upon the integrity of the market for the purpose of class certification as well as for ultimate proof of the claims on their merits. Plaintiffs will also rely, in part, upon the presumption of reliance established by material omissions and upon the actual reliance of the Class members.

The VL 2000

24. Videolan purports to be engaged in the development of communications products which utilize the Company's proprietary technology to transmit and receive real time, interactive video, voice and data signals to and from desktop personal computers ("PC's"). Videolan's first -- and to date only -- product, called the "VL 2000", has been described by the Company as consisting of a package of components integrated into a local area network and/or a wide area network. According to the Defendants, once installed, the VL 2000 enables users at their PC's to initiate and control multi-party, real time, interactive video, voice and data conferences.

25. By a Videolan press release dated October 19, 1995, Defendants announced the release of the VL 2000, stated that the VL 2000 would be shipped against a backlog of test bed orders beginning in December 1995 and that the VL 2000 would be commercially available in volume during the latter part of the first quarter of 1996.

The False And Misleading Representations

26. By a Videolan press release dated November 7, 1995, Defendants represented that Videolan had entered into a distribution agreement with Samsung (the "Samsung Agreement"), under which Samsung had agreed to purchase $50,000,000 to $70,000,000 worth of the VL 2000 over the three year term of the agreement, with shipments under the Samsung Agreement to begin during the first quarter of 1996.

27. On February 2, 1996, Videolan issued a press release in which Defendant Rothenberg represented that (i) Videolan and its management were not aware of any internal, operational or financial reasons that would justify volatility in the price of Videolan common stock and (ii) Videolan's previously announced product introductions and commitments (which would include the Samsung Agreement) were on schedule.

28. In a March 4, 1996 Videolan press release, Defendants again announced the release of the VL 2000 and stated that Videolan would begin shipping the VL 2000 in March 1996.

29. Defendants' representations set forth in paragraphs 26 through 28 above were false and misleading because they failed to disclose that under the Samsung Agreement, Samsung had no obligation to purchase anything from Videolan and that there was therefore no contract to purchase the $50,000,000 to $70,000,000 of the VL 2000 as represented by Defendants.

30. Defendants acted with scienter in that Defendants negotiated the terms of the Samsung Agreement and knew the terms of the Samsung Agreement at the time of the misrepresentations set forth above, and Defendants therefore knew (i) that the Samsung Agreement did not obligate Samsung to purchase anything from Videolan and (ii) that there was no contract to purchase the $50,000,000 to $70,000,000 of the VL 2000, as represented by Defendants.

31. Defendants not only made the misrepresentations regarding the Samsung Agreement set forth above, but Defendants also never corrected those misrepresentations.

32. Each of the Individual Defendants participated in the drafting, preparation and/or approval of one or more of the Company's press releases and reports complained of herein. By virtue of their positions as officers and/or directors of the Company, the Individual Defendants had the authority and ability to control, and, in fact, did control the contents of the Company's press releases. The Individual Defendants knew or recklessly disregarded that the contents of the Company's publicly disseminated press releases and reports alleged herein were false and misleading at the time of their issuance, and the Individual Defendants had the ability and opportunity to prevent the issuance of such press releases and reports or to cause them to be corrected, but the Individual Defendants failed to do so.

33. Plaintiffs repeat and reallege each and every allegation set forth above.

34. This claim is brought against the Defendants with respect to the entire Class Period and on behalf of the Class.

35. The Defendants individually and in concert, directly and indirectly, by the use of means or instrumentalities of interstate commerce and/or of the mails, engaged and participated in a continuous course of conduct to misrepresent and conceal material adverse information about Videolan and the Samsung Agreement as specified herein. The Defendants employed devices, schemes and artifices to defraud, while in possession of material adverse non-public information, and engaged in acts, practices, and a course of conduct as alleged herein in an effort to mislead the Plaintiffs and the Class in connection with Videolan and the Samsung Agreement. Defendants' fraudulent activities included disseminating untrue statements of material facts and omitting to state material facts necessary in order to make the statements made about Videolan and the Samsung Agreement in the light of the circumstances under which they were made, not misleading (at least to the extent set forth more particularly herein) and engaged in transactions, practices and course of business which operated as a fraud and deceit upon the purchasers of Videolan Securities during the Class Period.

36. As a result of the dissemination of the materially false and misleading information and failure to disclose material facts, as set forth above, the market prices of Videolan Securities were artificially inflated during the Class Period.

37. In ignorance of the materially false and misleading nature of the reports and statements described above, Plaintiffs and the other members of the Class relied on the reports and statements described above and/or on the integrity of the market prices of Videolan Securities and therefore purchased the Company's Securities at artificially inflated prices and suffered damages thereby. Had Plaintiffs and the other members of the Class known the truth, they would not have taken such action.

38. By virtue of the foregoing, Defendants have violated Section 10(b) of the Exchange Act, and Rule 10b-5 promulgated thereunder by the SEC.

39. Plaintiffs and the other members of the Class have been damaged by Defendants' violations as described in this Count and seek recovery for the damages caused thereby.

40. Plaintiffs repeat and reallege each and every allegation made above.

41. This Count is brought by Plaintiffs against the Individual Defendants with respect to the entire Class Period and on behalf of the Class.

42. By reason of their management positions within the Company and/or their membership on Videolan's Board of Directors and/or their control over the operations of Videolan, the Individual Defendants (i) were "controlling persons" within the meaning of § 20(a) of the Exchange Act and (ii) had the power and influence (which they exercised) (1) to direct the management and activities of Videolan and its employees, (2) to cause Videolan to engage in the wrongful conduct complained of herein and (3) to have prevented such violations from taking place but failed to do so.

43. By reason of these Individual Defendants each being a "controlling person," as that term is defined in Section 20(a) of the Exchange Act, of other persons primarily liable to Plaintiff and the Class pursuant to the claims arising under Section 10(b) of the Exchange Act alleged above, the Defendants named in this Count are liable for those primary violations pursuant to Section 20(a) of the Exchange Act.

Plaintiffs hereby demand a trial by jury.

WHEREFORE, Plaintiffs, on their own behalf and on behalf of the Class, prays for judgment as follows:

A. declaring this action to be a plaintiff class action properly maintained pursuant to Rule 23 of the Federal Rules of Civil Procedure;

B. awarding Plaintiffs and other members of the Class damages together with interest thereon;

C. awarding Plaintiffs and the other members of the Class their costs and expenses of this litigation, including reasonable attorneys' fees, and experts' fees and other costs and disbursements; and

D. awarding Plaintiffs and other members of the Class such other and further relief as may be just and proper under the circumstances.

Dated: May 9, 1997

OF COUNSEL

Andrew M. Schatz, Esquire
Jeffrey S. Nobel, Esquire
SCHATZ & NOBEL, P.C.
216 Main Street
Hartford, Connecticut 06106
Telephone: (860) 493-6292
Facsimile: (860) 493-6290

I, Brent Berti, hereby certify that the following is true and correct to the best of my knowledge, information and belief:

1. I have reviewed the complaint (the "Complaint") and authorized its filing.

2. I did not purchase the security that is the subject of this action at the direction of Plaintiff's counsel or in order to participate in this private action.

3. I am willing to serve as a representative party on behalf of the class (the "Class") as defined in the Complaint, including providing testimony at deposition and trial, if necessary.

4. My transactions in the common stock ("shares") and warrants ("warrants") of Videolan Technologies, Inc. during the Class Period defined in the Complaint are as follows:

Transaction                   Date                Price

Purchased 1000 warrants       November 15, 1995   $25.50
Sold 1000 warrants            November 30, 1995   $26.75 
Purchased 500 warrants        January 4, 1996     $29.25
Purchased 100 warrants        January 23, 1996    $31.25 
Purchased 400 warrants        January 25, 1996    $31.25
Purchased 500 warrants        January 26, 1996    $30.75
Purchased 500 warrants        January 26, 1996    $30.75
Purchased 500 warrants        February 6, 1996    $10.75
Purchased 1000 warrants       May 7, 1996         $11.50

5. I also (i) sold 500 warrants on November 7, 1995 at $24.50, which I had originally purchased before the commencement of the Class Period and (ii) engaged in the following transactions after the close of the Class Period:

Transaction                   Date                Price

Sold 1000 warrants            June 7, 1996        $10.25
Purchased 2000 shares         June 21, 1996       $20.50
Sold 500 warrants             October 29, 1996    $1.50
Sold 2000 shares              October 29, 1996    $3.625
Sold 1000 warrants            November 6, 1996    $1.50

6. During the three years prior to the date of this Certificate, I have sought to serve as a representative party on behalf of a class in one private action arising under the federal securities laws, entitled Trevor Roberts, et al v. IMP, Inc., et al, pending in the United States District Court, Northern District of California, San Jose Division.

7. I will not accept any payment for serving as a representative party on behalf of the Class beyond my pro rata share of any possible recovery, except such reasonable costs and expenses (including lost wages) directly relating to the representation of the Class as ordered or approved by the Court.

I declare under penalty of perjury that the foregoing is true and correct. Executed this __th day of April 1997.

I, Brent Berti, hereby certify that the following is true and correct to the best of my knowledge, information and belief:

1. I have reviewed the complaint (the "Complaint") and authorized its filing.

2. I did not purchase the security that is the subject of this action at the direction of Plaintiff's counsel or in order to participate in this private action.

3. I am willing to serve as a representative party on behalf of the class (the "Class") as defined in the Complaint, including providing testimony at deposition and trial, if necessary.

4. My transactions in the common stock ("shares") and warrants ("warrants") of Videolan Technologies, Inc. during the Class Period defined in the Complaint are as follows:

Transaction                   Date                Price

Purchased 1000 warrants       November 15, 1995   $25.50
Sold 1000 warrants            November 30, 1995   $26.75 
Purchased 500 warrants        January 4, 1996     $29.25
Purchased 100 warrants        January 23, 1996    $31.25 
Purchased 400 warrants        January 25, 1996    $31.25
Purchased 500 warrants        January 26, 1996    $30.75
Purchased 500 warrants        January 26, 1996    $30.75
Purchased 500 warrants        February 6, 1996    $10.75
Purchased 1000 warrants       May 7, 1996         $11.50

5. I also sold 500 warrants on November 7, 1995 at $24.50, which I had originally purchased before the commencement of the Class Period.

6. During the three years prior to the date of this Certificate, I have sought to serve as a representative party on behalf of a class in one private action arising under the federal securities laws, entitled Trevor Roberts, et al v. IMP, Inc., et al, pending in the United States District Court, Northern District of California, San Jose Division.

7. I will not accept any payment for serving as a representative party on behalf of the Class beyond my pro rata share of any possible recovery, except such reasonable costs and expenses (including lost wages) directly relating to the representation of the Class as ordered or approved by the Court.

I declare under penalty of perjury that the foregoing is true and correct. Executed this __th day of May 1997.

I, Steven Shaw, hereby certify that the following is true and correct to the best of my knowledge, information and belief:

1. I have reviewed the complaint (the "Complaint") and authorized its filing.

2. I did not purchase the security that is the subject of this action at the direction of Plaintiff's counsel or in order to participate in this private action.

3. I am willing to serve as a representative party on behalf of the class (the "Class") as defined in the Complaint, including providing testimony at deposition and trial, if necessary.

4. My transactions in the warrants ("warrants") of Videolan Technologies, Inc. during the Class Period defined in the Complaint are as follows:

Transaction                   Date                Price

Purchased 2500 warrants       March 18, 1996      $14.00

5. During the three years prior to the date of this Certificate, I have not sought to serve, nor have I served, as a representative party on behalf of a class in any private action arising under the federal securities laws.

6. I will not accept any payment for serving as a representative party on behalf of the Class beyond my pro rata share of any possible recovery, except such reasonable costs and expenses (including lost wages) directly relating to the representation of the Class as ordered or approved by the Court.

I declare under penalty of perjury that the foregoing is true and correct. Executed this __th day of May 1997.

Source: Emailed file from Schatz & Nobel, P.C.