According to the docket, on September 3, 1999, the plaintiffs filed a Notice of Appeal from the earlier August 6, 1999 Order dismissing the complaint. On June 6, 2000, the Court entered the Order from the Fourth Circuit Court of Appeals remanding the case to District Court. On October 13, 2000, the Court entered the Order and Final Judgment, and awarded Plaintiffs Counsel the sum of $607,548.79 in fees and $69,780.09 in reimbursement of expenses paid from the Settlement Fund. The case was closed.
In a summary on Lexis Nexus, defendants moved to dismiss the complaint. The court granted the motion, holding that plaintiffs failed to satisfy the heightened pleading requirements of the PLRSA because plaintiffs did not provide in the preamble to the complaint that the allegations therein were based on plaintiffs' own personal knowledge. The court granted defendants' motion to dismiss the complaint under the Private Securities Litigation Reform Act of 1995 (PLRSA), finding that the preamble failed to state that the complaint was based on the plaintiffs' personal knowledge, a pleading requirement imposed by the PSLRA, which mandated dismissal if not satisfied.
By the Stipulation and Order dated January 6, 1999, the action was transferred to the U.S. District Court for the District of Maryland, Southern Division.
The original complaint names Manugistics and certain of the Company's officers and directors as defendants, alleging that these parties violated Sections 10(b) and 20(a) of the Exchange Act, as well as SEC Rule lOb-5 promulgated thereunder, by originating a series of materially misleading statements and omissions concerning the Company's business prospects and operations during the Class Period. Specifically, Plaintiff alleges that the defendants misled the investing public into believing that the Company was having yet another successful quarter with record revenues, and specifically endorsed analysts' earnings estimates of $0.13 per share, when in fact the Company was experiencing significant problems integrating new sales personnel and integrating a newly acquired division. Similarly, Plaintiff alleges that the Company failed to disclose that the Company's senior sales personnel were distracted from closing sales due to their role in the training and selection of new sales personnel, while Manugistics' senior management was highly distracted by two potential acquisitions which the Company was contemplating during the Class Period. These problems, and their effects on the Company's business prospects, were undisclosed at all times during the Class Period, and were knowingly and/or recklessly misrepresented by the Defendants. These misrepresentations and omissions had the aggregate effect of artificially inflating the share prices of Manugistics' stock, until the truth was revealed at the end of the Class Period with the revelation that the Company was having significant difficulties in closing sales, and would suffer a significant operating loss, due to the problems outlined above. However, Plaintiff alleges that the defendants and other Manugistics insiders took advantage of the artificially inflated share prices by selling more than 118,000 shares of Manugistics stock between March 31, 1998 and April 9, 1998, thereby amassing proceeds of more than $6.7 million.