Ashworth, Inc. - Securities Class Action

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_______________
Copyright (c) 2001
Stanford Law School

Ashworth, Inc. Conclusion: According to the Company’s FORM 10-K for the fiscal year ended October 31, 2004, on November 8, 2004, the U.S. District Court entered a Final Approval of Settlement. Under the settlement, all claims will be dismissed and the litigation will be concluded in exchange for a payment of $15.25 million, approximately 82% of which will be paid by Ashworth’s insurance carriers. As part of the settlement, Ashworth also agreed to adopt modifications to certain corporate governance policies. Ashworth recorded a pre-tax charge of $3 million in the third quarter of fiscal year 2004 related to settlement of this suit.

As reported by the same SEC filing, in January 22, 1999, Milberg Weiss Bershad Hynes & Lerach LLP filed a class action in the United States District Court for the Southern District of California (“U.S. District Court”) on behalf of purchasers of the Company’s common stock during the period between September 4, 1997 and July 15, 1998. The action was subsequently consolidated with two similar suits and plaintiffs filed their Amended and Consolidated Complaint on December 17, 1999. Upon the Company’s motion, the U.S. District Court dismissed the Complaint with leave to amend on July 18, 2000. On September 18, 2000, plaintiffs served their Second Consolidated Amended Complaint (“Second Amended Complaint”). On November 6, 2000, the Company filed its motion to dismiss the Second Amended Complaint, which the U.S. District Court granted, in part, and denied, in part. The remaining portions of the Second Amended Complaint alleged that, among other things, during the class period and in violation of the Securities Exchange Act of 1934, the Company’s financial statements, as reported, did not conform to generally accepted accounting principles with respect to revenues

The original complaint alleges that during the class period, defendants knowingly or recklessly failed to disclose the following facts about Ashworth: a) Ashworth's new, redeveloped infrastructure, including its increasing use of offshore factories, was extremely troubled with inadequate quality-control testing and insufficient supervision, which, while generating short-term cost savings, would require dramatically higher costs in future periods to successfully manufacture, supervise and monitor manufacturing in these locations; b) due to problems in matching production with demnad, Ashworth had acucmulated large amounts of excessive inventories of its Basics product line. c) Ashworth's attempts to accelerate the relocation of larger amounts of its manufacturing operations offshore were resulting in significant operational inefficiencies and greatly increased expense and others allegations.

INDUSTRY CLASSIFICATION:
SIC Code: 2329
Sector: Consumer Cyclical
Industry: Apparel/Accessories

COMPANY/ISSUER NAME:	Ashworth, Inc.
COMPANY/ISSUER TICKER:	ASHW
COMPANY WEBSITE:	http://www.ashworth.com

FIRST IDENTIFIED COMPLAINT IN THE DATABASE

Johnson, et al. v. Ashworth, Inc., et al.

COURT: S.D. California	DOCKET NUMBER: 99-CV-00121
JUDGE NAME: Hon. Thomas J. Whelan
DATE FILED: 01/22/1999	SOURCE: Business Wires
CLASS PERIOD START: 09/04/1997	CLASS PERIOD END: 07/15/1998
TYPE OF COMPLAINT: First Consolidated
PLAINTIFF FIRMS IN THIS OR SIMILAR CASE:
Berger & Montague PC 1622 Locust Street, Philadelphia, PA, 19103 (voice) 800.424.6690, (fax) 215.875.4604, investorprotect@bm.net 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 Olsen Law Firm 2121 K Street, N.W. Suite 80, Washingtoneet, DC, 20037 (voice) 703.351.5199, (fax) , _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 3

DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT
Class Action Complaint For Violation Of The Securities Exchange Act Of 1934 - Plaintiff Demands a Trial by Jury
Type: Complaint		Date on the document: 01/22/1999
U.S. District Court Civil Docket
Type: Docket		Date on the document: 05/27/1999

REFERENCE COMPLAINT

In Re: Ashworth, Inc. Securities Litigation

COURT: S.D. California	DOCKET NUMBER: 99-CV-00121
JUDGE NAME: Hon. M. James Lorenz
DATE FILED: 09/18/2000	SOURCE: Business Wires
CLASS PERIOD START: 09/04/1997	CLASS PERIOD END: 07/15/1998
TYPE OF COMPLAINT: Second Amended
PLAINTIFF FIRMS NAMED IN COMPLAINT:
Berger & Montague PC 1622 Locust Street, Philadelphia, PA, 19103 (voice) 800.424.6690, (fax) 215.875.4604, investorprotect@bm.net Klafter & Olsen LLP 2121 K St., NW Suite 800, Washington, DC, 20037 (voice) 202.261.3553, (fax) 202.261.3533, info@klafterolsen.com Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego) 401 B Street, Suite 1700, San Diego, CA, 92101 (voice) 206.749.5544, (fax) 206.749.9978, info@lerachlaw.com Milberg Weiss Bershad Hynes & Lerach LLP (S.F., CA) 100 Pine Street - Suite 2600, San Francisco, CA, 94111 (voice) 415.288.4545, (fax) 415.288.4534, 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: 5

DOCUMENTS FOR THE REFERENCE COMPLAINT
Second Consolidated Amended Complaint For Violations Of The Securities Exchange Act Of 1934
Type: Complaint		Date on the document: 09/18/2000
Notice Of Proposed Class Action Settlement
Type: Notice		Date on the document: 09/10/2004
Notice Of Proposed Class Action Settlement (Exhibit A)
Type: Other		Date on the document: 09/10/2004
Stipulation and Agreement of Settlement
Type: Settlement		Date on the document: 09/10/2004
Order and Final Judgment
Type: Order		Date on the document: 11/08/2004
U.S. District Court Civil Docket
Type: Docket		Date on the document: 11/08/2004

OTHER DOCUMENTS

Case Name and/or Number:
Type:		Date on the document:

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