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TippingPoint Technologies Summary: According to a press release dated December 6, 2006, Wall Street banks, accused of manipulating the prices of initial public offerings of technology companies during the market boom of the late 1990s and cheating small investors out of hundreds of millions of dollars, will not have to face a huge securities class-action lawsuit, a federal appeals court ruled yesterday. The decision was seen on Wall Street as a huge victory. The investment banks faced making payments of billions of dollars to settle the accusations — if they chose not to risk a trial — involving potentially millions of investors, lawyers involved in the case said. The ruling also raises the prospects that earlier settlements in the case, in particular a $425 million agreement with J. P. Morgan Chase and a $1 billion guaranteed proposed deal with the issuers of the new shares that was still pending approval by the judge in the case, could be nullified. Nearly all firms on Wall Street were touched by the lawsuit. Described by many as the largest consolidated securities class-action case ever, the I.P.O. lawsuit involved more than 300 individual investors, 309 issuers and 55 underwriters, including Merrill Lynch, Goldman Sachs, Morgan Stanley and Credit Suisse First Boston. Yesterday, a three-judge panel of the Federal Court of Appeals for the Second Circuit in Manhattan said the federal judge overseeing the lawsuit had erred in granting class-action status to six “focus cases” out of 310 consolidated class actions that claimed fraud on the part of many of the nation’s largest securities underwriters. That means investors will probably have to pursue their claims individually, in some cases perhaps through arbitration, lawyers involved in the case said. “It’s a big win with far-reaching implications for the I.P.O. cases and for class actions,” said Gandolfo V. DiBlasi, a lawyer with Sullivan & Cromwell who represented Goldman Sachs and acted as lead liaison for the defendants in the case.
The original complaint charges defendants with violations of Sections 11,12 and 15 of the Securities Act of 1933 for issuing a registration statement and prospectus (collectively, the "Prospectus") that contained material misrepresentations and/or omissions. The Prospectus was issued in connection with the Netpliance IPO. The complaint alleges that the Prospectus was false and misleading because it failed to disclose that the Underwriter Defendants entered into unlawful tie-in and other arrangements and agreements with customers, which manipulated the demand for and stock price of Netpliance shares. The Underwriter Defendants induced their customers to purchase shares in the Netpliance IPO as a quid pro quo for receiving favorable IPO allocations in the "hot" IPOs of other technology companies. In this manner, defendants created a false demand for the Company's shares on the IPO and artificially inflated its stock price in the after market.
INDUSTRY CLASSIFICATION:
SIC Code: 3571
Sector: Technology
Industry: Computer Services
| COMPANY/ISSUER NAME: | TippingPoint Technologies |
| COMPANY/ISSUER TICKER: | TPTI |
| COMPANY WEBSITE: | http://www.netpliance.com |
| FIRST IDENTIFIED COMPLAINT IN THE DATABASE | |||||||||||||||||
| Brian Levey, et al. v. Donaldson Lufkin & Jenrette, et al. | |||||||||||||||||
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| DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT | |||
| Type: | Date on the document: | ||
| REFERENCE COMPLAINT | |||||||||||||||||
| In re Tippingpoint Technologies, Inc. (F/K/A Netpliance) Initial Public Offering Securities Litigation | |||||||||||||||||
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| DOCUMENTS FOR THE REFERENCE COMPLAINT | |||
| Amended Class Action Complaint For Violations Of The Federal Securities Laws | |||
| Type: Complaint | Date on the document: 05/30/2002 | ||
| OTHER DOCUMENTS | |||
| Case Name and/or Number: | |||
| Type: | Date on the document: | ||
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