According to the firm's 10-K filing dated 8/21/2001, the Company have reached a tentative settlement agreement with the plaintiff class in which it agreed to pay $2.7 million to the plaintiffs. The full payment will be covered by insurance. In the Order dated February 06, 2002 signed by Judge Richard A. Lazzara, the final distribution of settlement funds is approved.
On March 22, 2000, the United States District Court for the Middle District of Florida, Tampa Division entered an order dismissing the consolidated class action complaint brought against the Company and certain former directors and executives on June 19, 1998. The Plaintiffs then filed the Notice of Appeal on April 21, 2000. The court Order dated February 02, 2001, granted the parties' joint motion to conditionally vacate and remand based upon execution of stipulated settlement agreement, which is construed as a motion for limited remand for purposes of obtaining the District Court's approval of the proposed settlement agreement, as required by Federal Rule of Civil Procecure 23. Should the District Court approve of the settlement agreement, the parties should promptly file a motion to dismiss this appeal. On the same day of the court order, the case reopened.
The original Complaint alleges that defendants made false and misleading statements, inter alia, about Danka's acquisition from Eastman Kodak of Danka's Office Imaging and Imaging Services businesses and the Company's success in integrating this acquisition into Danka's business operations. The Complaint alleges that despite Danka's public statements that the integration of these businesses was very easy and was proceeding smoothly and successfully and would result in enormous savings for the Company, the truth was that the integration of the new businesses was a disaster, that it was significantly delayed and was causing substantially increased costs and lower earnings for Danka.