AstroPower, Inc. - Securities Class Action

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Copyright (c) 2001
Stanford Law School

AstroPower, Inc. Summary: On May 9, 2007 Judge Joseph J. Farnan, Jr signed the Order & Final Judgment in favor of the Class Members and against AstroPower, Inc. The judge awareded Plaintiff's attorneys fees of 25%, or $250,000 and an additional $85,783.34 in expenses from the $1,000,000 settlement fund.

According to a press release dated March 6, 2007, the action has been certified as a class action for certain purposes and that a settlement for One Million Dollars ($1,000,000) has been proposed. A hearing will be held before the Honorable Joseph Farnan in the United States District Court for the District of Delaware, J. Caleb Boggs Fed. Bldg., 844 N. King Street, Wilmington, DE 19801, at 10:00 a.m., on May 9, 2007 to determine whether: (1) the proposed settlement should be approved by the Court as fair, reasonable and adequate; (2) Lead Counsel's application for an award of attorneys' fees and reimbursement of expenses should be approved; and (3) the claims against Defendants and Astropower should be dismissed with prejudice.

On April 28, 2006, the remaining individual defendant filed a motion to dismiss for failure to state a claim. On October 17, 2006, the plaintiff’s lawyer filed a letter to The Honorable Joseph J. Farnan, Jr. advising the Court that the parties have reached an agreement in principle and requesting the Court to defer issuing a ruling on the pending motion to dismiss and stay the proceedings until the parties submit settlement papers.

According to a press release dated February 28, 2006, the U.S. District Court for the District of Delaware dismissed a securities fraud class action against a company's chief financial officer because the class failed to plead the claims with particularity as required by the Private Securities Litigation Reform Act. Lead class plaintiff, Leeb Capital Management, on behalf of itself and others similarly situated, sued AstroPower Inc. for securities fraud violations pursuant to § 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5….The class also sued AstroPower's CFO, as a controlling person pursuant to § 20 of the Exchange Act. AstroPower's CFO moved to dismiss the claims against him, arguing that the complaint failed to meet the heightened pleading requirements of the PSLRA, failing to plead to particular facts surrounding the alleged fraud, establish scienter, and show that the CFO was a "controlling person" within § 20. …The district court concluded that the complaint failed to describe with particularity the facts surrounding the alleged material misrepresentations because it did not state the amount of money, customers, or dates involved in the alleged fraud. The court held that the Rule 10(b) and 10b-5 claims were not sufficiently pled. Thus, the district court ruled that the § 20 claim was not established against the CFO, due to the lack of an independent claim under the Exchange Act. The district court dismissed the class claims against AstroPower's CFO, but allowed the plaintiffs leave to amend the complaint.

As summarized by the latest docket, on April 8, 2004, AstroPower, Inc. filed a suggestion of bankruptcy, and on April 15, 2004, the Court entered the Order signed by U.S. District Judge Joseph J. Farnan Jr. staying the action as to defendant AstroPower pending disposition of Defendant's pending action in the United States Bankruptcy Court for the District of Delaware. On January 14, 2005, the plaintiffs filed an Amended Class Action Complaint against the remaining individual defendants. On May 13, 2005, one of the individual defendants filed a motion to dismiss based on failure to state a claim and failure to plead with sufficient detail.

The original complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of materially false and misleading statements to the market between February 22, 2002 and August 1, 2002.

The complaint alleges that AstroPower develops, manufactures, markets and sells a range of solar electric power generation products. The complaint further alleges that the company claimed that it was well positioned to take advantage of the increasing demand for solar power products. The complaint further alleges that, throughout the Class Period, the Company reported strong revenue and earnings growth and that, as a result of these statements and reports, which were disseminated to the investing public, and which formed the basis for research analysts' reports on the Company, the Company's per share stock price reached a Class Period high of $27 on March 28, 2002. In truth and in fact, throughout the Class Period, the Company was unable to effectively manage its expanding and increasingly complex operations; it was, inter alia, unable to allocate resources among its various manufacturing facilities to effectively meet regional demand or to tailor its production capacity to actual demand. Consequently, during the time that the Company was stating that it was well positioned to take advantage of the increased demand for solar products, it was in fact losing ground to more effective competitors. Additionally, to maintain the illusion that its operations were successful, the Company throughout the Class Period reported artificially inflated revenue and earnings by, inter alia, recording revenue in advance of shipment, contrary to its stated principles of revenue recognition. The truth was revealed on August 1, 2002 when, after the close of trading, the Company announced its results for the second quarter ended June 30, 2002. Analysts were stunned. Reported revenue and net income had not grown but, on the contrary, second quarter income was $365,000, or $0.02 per diluted share compared to $1.7 million, or $0.07 per diluted share in the year-earlier second quarter and revenue of $20.4 million represented only a one percent increase over reported revenue for the prior quarter and was approximately $4.9 million below analysts' consensus estimate. On this news, AstroPower's share price plunged 48%, or $7.12, to $7.77, its lowest price in almost three years.

INDUSTRY CLASSIFICATION:
SIC Code: 3674
Sector: Technology
Industry: Electronic Instruments & Controls

COMPANY/ISSUER NAME:	AstroPower, Inc.
COMPANY/ISSUER TICKER:	APWR
COMPANY WEBSITE:	http://www.astropower.com

FIRST IDENTIFIED COMPLAINT IN THE DATABASE

John Savage, et al. v. AstroPower, Inc., et al.

COURT: D. Delaware	DOCKET NUMBER: 03-CV-0260
JUDGE NAME: Hon. Joseph J. Farnan Jr.
DATE FILED: 03/07/2003	SOURCE: Business Wires
CLASS PERIOD START: 02/22/2002	CLASS PERIOD END: 08/01/2002
TYPE OF COMPLAINT: Unamended/Unconsolidated
PLAINTIFF FIRMS IN THIS OR SIMILAR CASE:
Abbey Gardy, LLP 212 East 39th Street, New York, NY, 10016 (voice) 212.889.3700, (fax) , info@abbeygardy.com Bernstein Litowitz Berger & Grossmann LLP (New York, NY) 1285 Avenue of the Americas, 33rd Floor, New York, NY, 10019 (voice) 212.554.1400, (fax) 212.554.1444, blbg@blbglaw.com Brian Felgoise 230 South Broad Street, Suite 404 , Philadelphia, PA, 19102 (voice) 215.735.6810, (fax) 215/735.5185., Brodsky & Smith, LLC 11 Bala Avenue, Suite 39, Bala Cynwyd, PA, 19004 (voice) 610.668.7987., (fax) 610.660.0450, esmith@Brodsky-Smith.com Cauley Geller Bowman Coates & Rudman, LLP (New York) 200 Broadhollow, Suite 406, Melville, NY, 11747 (voice) 631.367.7100, (fax) 631.367.1173, Law Offices of Charles J. Piven, P.A. World Trade Center-Baltimore,401 East Pratt Suite 2525, Baltimore, MD, 21202 (voice) 410.332.0030, (fax) , pivenlaw@erols.com Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY) One Pennsylvania Plaza, New York, NY, 10119-1065 (voice) 212.594.5300, (fax) , Spector Roseman & Kodroff (San Diego) 1818 Market Street, Suite 2500, Philadelphia, PA, 19103 (voice) 215.496.0300, (fax) 215.496.6611, Wolf Haldenstein Adler Freeman & Herz LLP 270 Madison Avenue, New York, NY, 10016 (voice) 212.545.4600, (fax) 212.686.0114, newyork@whafh.com _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 9

DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT

Type:		Date on the document:

REFERENCE COMPLAINT

In Re: AstroPower, Inc. Securities Litigation

COURT: D. Delaware	DOCKET NUMBER: 03-CV-0260
JUDGE NAME: Hon. Joseph J. Farnan Jr.
DATE FILED: 01/14/2005	SOURCE: Business Wires
CLASS PERIOD START: 02/22/2002	CLASS PERIOD END: 08/01/2002
TYPE OF COMPLAINT: Consolidated and/or Amended
PLAINTIFF FIRMS NAMED IN COMPLAINT:
Rosenthal, Monhait, Gross & Goddess, P.A. Suite 1401, Mellon Bank Center, PO Box 1070, Wilmington, DE, 19899-0170 (voice) , (fax) , Schiffrin & Barroway LLP 3 Bala Plaza E, Bala Cynwyd, PA, 19004 (voice) 610.667.7706, (fax) 610.667.7056, info@sbclasslaw.com Schiffrin Barroway Topaz & Kessler, LLP 2125 Oak Grove Road, Suite 120, Walnut Creek, CA, 94598 (voice) 925.945.0200, (fax) 925.945.8792, info@sbtklaw.com _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 3

DOCUMENTS FOR THE REFERENCE COMPLAINT
Stipulation and Agreement of Settlement
Type: Settlement		Date on the document: 01/30/2007
Notice Of Proposed Settlement Of Class Action, Motion For Attorneys’ Fees And Reimbursement Of Expenses And Settlement Fairness Hearing
Type: Notice		Date on the document: 02/09/2007
Proof of Claim and Release
Type: Other		Date on the document: 02/09/2007
Order and Final Judgment
Type: Order		Date on the document: 5/9/2007
U.S. District Court Civil Docket
Type: Docket		Date on the document: 05/09/2007

OTHER DOCUMENTS
Class Action Complaint for Violation of the Federal Securities Laws - Jury Trial Demanded
Case Name and/or Number: Robert Scott, et al. v. AstroPower, Inc., et al.
Type: Complaint		Date on the document: 03/13/2003
Class Action Complaint for Violations of Federal Securities Laws - Jury Trial Demanded
Case Name and/or Number: Larry Quick, et al. v. AstroPower, Inc., et al.
Type: Complaint		Date on the document: 04/16/2003

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