Nu-Kote Holding, Inc. - Securities Class Action

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_______________
Copyright (c) 2001
Stanford Law School

Nu-Kote Holding, Inc. Conclusion: According to the latest docket posted, on February 2, 2001, the case was reopened. On February 20, 2001, the Court entered the Order that the action was dismissed with prejudice as requested against defendant Nu-Kote Holding, Inc., and that plaintiff's claims against other defendants remain open. On September 7, 2001, the Court entered the Memorandum Opinion and Order granting the remaining defendants’ motions to dismiss and denied the plaintiffs’ motion to certify the class action. Judgment was further entered that day and the case was closed. On September 10, 2002, the plaintiff filed a notice of appeal. On November 7, 2002, the Court entered the Order of the U.S. Court of Appeals. Pursuant to the agreed motion of the parties, Lori Lemmer and Hans Paffhausen, portions of the appeal of Lemmer v. Paffhausen were dismissed. On September 8, 2003, the Court entered the Judgment/Mandate of the USCA which affirmed the Judgment of the District Court.

As previously reported by the Company’s FORM 10-K For The Fiscal Year Ended March 31, 1999, all proceedings in this case have been stayed as a result of Nu-kote's filing for protection under Chapter 11 of the U.S. Bankruptcy Code. On September 28, 1999, Nu-kote's lead bankruptcy counsel was notified by the United States District Court for the Northern District of Texas that this case was to be administratively closed.

The complaint charges Nu-kote and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that defendants knowingly made false and misleading statements about the success of Nu-kote's 1995 acquisition of Pelikan Products (a large European seller of impact and non-impact printing products), the strong demand for, and market acceptance of, Nu-kote's products, Nu-kote's successful transition from sales of impact products to non-impact products, including its state-of-the-art manufacturing facilities in the U.S. and Europe, its technological research and development expertise that purportedly enabled it to rapidly develop large numbers of new products, including piezoelectric non-impact printer heads and related products and Nu-kote's prospects for strong earnings per share growth during FY97-FY98, while reporting false financial results, including inflated earnings per share for the 4thQ of FY96 and the 1stQ, 2ndQ and 3rdQ of FY97. As a result of these allegedly false statements, assurances and forecasts, Nu- kote's stock advanced from $10-3/8 per share in March 1995 to a Class Period high of $22-1/2 in November 1995, a 100%+ increase. However, beginning in mid- 1996, Nu-kote began to report disappointing lower-than-forecasted results, followed by large and escalating losses. Despite Nu-kote's continuing reassurances that its problems were temporary and could be or were being overcome and it would return to profitability, it did not. In FY97, it suffered a huge $49 million, $2.28 per share loss, followed by more losses in FY98 to date, due to the failure of the Pelikan merger, including the inability to successfully integrate Pelikan's operations into Nu-kote's, much larger than forecast "restructuring" charges due to the closing of outdated, uneconomical manufacturing facilities, the failure to generate sufficient sales of non- impact printing products to offset the decline in the sales of impact printing products, the failure to successfully develop commercially viable products based on the piezoelectric technology and huge writedowns of excess, over- valued impact printing supply products. Nu-kote's stock collapsed to less than $1 per share, 99% below its Class Period high, Nu-kote's Board sold off non- essential assets to raise cash to permit the Company to continue operations and put the Company up for sale, as its ability to continue in business as a separate entity was now very much in doubt.

INDUSTRY CLASSIFICATION:
SIC Code: 3950
Sector: Consumer Non-Cyclical
Industry: Office Supplies

COMPANY/ISSUER NAME:	Nu-Kote Holding, Inc.
COMPANY/ISSUER TICKER:	NKOT
COMPANY WEBSITE:	http://www.nukote.com/

FIRST IDENTIFIED COMPLAINT IN THE DATABASE

Lori Lemmer, et al. v. Nu-Kote Holding, Inc., et al.

COURT: N.D. Texas	DOCKET NUMBER: 98-CV-00161
JUDGE NAME: Hon. Robert B. Maloney
DATE FILED: 01/23/1998	SOURCE: Business Wires
CLASS PERIOD START: 07/28/1995	CLASS PERIOD END: 05/29/1997
TYPE OF COMPLAINT: Unamended/Unconsolidated
PLAINTIFF FIRMS IN THIS OR SIMILAR CASE:
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 Robert C. Sussner , , , (voice) , (fax) , Stanley, Mandel & Iola LLP 3100 Monticello Avenue, Suite 750 , Dallas, TX, 75205 (voice) 214.443.4300, (fax) , _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 3

DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT
Order Granting Motion For Appointment Of Lead Plaintiff And Lead Counsel
Type: Order		Date on the document: 03/31/1998
CIVIL DOCKET FOR CASE #: 98-CV-161
Type: Docket		Date on the document: 04/24/1998
Order
Type: Order		Date on the document: 09/28/1999
Order
Type: Order		Date on the document: 02/05/2001
Order
Type: Order		Date on the document: 02/16/2001
Judgment
Type: Other		Date on the document: 09/06/2001
Memorandum Opinion And Order
Type: Order		Date on the document: 09/06/2001
Entry Of Dismissal
Type: Other		Date on the document: 11/07/2002
Entry Of Dismissal
Type: Other		Date on the document: 12/30/2002
Appeal Mandate
Type: Other		Date on the document: 09/08/2003
U.S. District Court Civil Docket
Type: Docket		Date on the document: 10/20/2003

OTHER DOCUMENTS

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

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