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Pixelplus Company, Ltd. Summary: According to a press release dated April 18, 2006, the Complaint charges that defendants violated the Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Sections 11 and 15 of the Securities Act of 1933 by issuing materially false and misleading financial information. The Complaint alleges that the during the Class Period, the Company reported materially false and misleading revenues for each reporting period in 2005. In particular, the Complaint alleges that the Company violated Generally Accepted Accounting Principles and the Federal Securities Laws, by failing to recognize sales to one of its affiliates, PTI, on a consolidated basis and recognizing sales that were uncollectible, which resulted in the Company overstating its revenues for 2005.
The complaint further alleges that on or around April 11, 2006, the Company shocked the market when it announced, among other things, that its financial statements for 2005 should no longer be relied upon because the Company improperly recognized sales to PTI because the Company failed to consolidate PTI's results and accounted for sales that had uncertain collectibility. The Company admitted that it controls PTI as it has the ability to elect two-thirds of PTI's Board. As a result, the Company announced that revenues would be reduced by approximately $3.6 million and $2.5 million, for the fourth quarter of 2005 and fiscal year 2005, respectively. Following these adverse disclosures, the Company's stock price dropped nearly 37.2%.
The class action lawsuit has been filed on behalf of all purchasers of Pixelplus American Depositary Shares during the class period, including purchasers in the Company's Initial Public Offering
On March 28, 2007 the judge granted motions to appoint lead plaintiff and approved the selection of lead counsel. A consolidated complaint was filed on June 25, 2007; defendants filed for dismissal on August 24, 2007.
On November 06, 2008, an order preliminarily approving settlement and providing for notice to determine whether the proposed settlement of the Litigation on the terms and conditions provided for in the Stipulation is fair, reasonable and adequate to the Class.
Originally, the settlement agreement called for a $1,000,000 cash payment from the company and $355,000 from the underwriter defendants. However, on March 10, 2009, after an order from the judge approving an addendum to the Stipulation of Settlement, the Company issued a press release regarding changes to the agreement. According to the firm, due to the economic turmoil in Asia, the Company is not able to fund the $1,000,000 cash settlement. Instead, through its insurer, 500,000,000 South Korean Won ($331,219.43 per exchange rates on 3/10/2009) will be deposited into the escrow account within two business days of Final Approval of the settlement. Expected investor recovery has dropped to $.13 per ADS. All other terms of the settlement agreement remain intact.
Final Approval and Dismissal of the case was entered on March 20, 2009.
On November 09, 2009, an order approving distribution of net settlement fund and awarding additional attorneys' fees was entered on the court’s docket. The Lead Plaintiffs proposed distribution of the Net Settlement Fund to Authorized Claimants was approved.
INDUSTRY CLASSIFICATION:
SIC Code: 3674
Sector: Technology
Industry: Semiconductors
| COMPANY/ISSUER NAME: | Pixelplus Company, Ltd. |
| COMPANY/ISSUER TICKER: | PXPL |
| COMPANY WEBSITE: | http://www.pixelplus.com |
| FIRST IDENTIFIED COMPLAINT IN THE DATABASE | |||||||||||||||||
| Michael Y. Kim, et al. v. Pixelplus Company, Ltd., et al. | |||||||||||||||||
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| DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT | |||
| Class Action Complaint for Violation of Federal Securities Laws - Jury Trial Demanded | |||
| Type: Complaint | Date on the document: 04/14/2006 | ||
| US District Court Civil Docket | |||
| Type: Docket | Date on the document: 09/13/2006 | ||
| REFERENCE COMPLAINT | |||||||||||||||||
| West End Capital Management, LLC, et al. v. Pixelplus Company, Ltd., et al. | |||||||||||||||||
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| DOCUMENTS FOR THE REFERENCE COMPLAINT | |||
| Consolidated Amended Class Action Complaint For Violations Of Federal Securities Laws | |||
| Type: Complaint | Date on the document: 06/25/2007 | ||
| Stipulation of Settlement By All Parties | |||
| Type: Settlement | Date on the document: 11/04/2008 | ||
| Notice Of Pendency And Proposed Settlement Of Class Action Including Proposed Plan Of Allocation | |||
| Type: Notice | Date on the document: 11/06/2008 | ||
| Order Preliminarily Approving Settlement And Providing For Notice | |||
| Type: Settlement | Date on the document: 11/06/2008 | ||
| Proof of Claim and Release | |||
| Type: Other | Date on the document: 11/06/2008 | ||
| Order Approving Addendum To Stipulation Of Settlement And Addendum Notice Publication | |||
| Type: Settlement | Date on the document: 03/09/2009 | ||
| Order and Final Judgment | |||
| Type: Order | Date on the document: 03/20/2009 | ||
| U.S. District Court Civil Docket | |||
| Type: Docket | Date on the document: 11/09/2009 | ||
| OTHER DOCUMENTS | |||
| Class Action Complaint--Jury Trial Demanded | |||
| Case Name and/or Number: Detwiler, et al. v. Pixelplus Company, Ltd., et al. | |||
| Type: Complaint | Date on the document: 04/25/2006 | ||
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