According to Mitcham Industries’ Form 10-K For The Fiscal Year Ended January 31, 2003, on August 10, 2001, facing protracted and expensive litigation, Defendants executed a final settlement agreement with Plaintiffs for $2.7 million, paid by Mitcham ($1.1 million) and its insurance carrier ($1.6 million). On December 10, 2001, the Court approved the settlement agreement, certified the class for settlement purposes only, and entered a Final Judgment and Order dismissing all the class action lawsuits with prejudice.
On October 2, 2000, the Court entered Order by U.S. District Judge Vanessa D. Gilmore granting in part and denying in part two separate motions to dismiss second consolidated amended class action complaint filed by the Underwriter Defendants as well as Mitcham Industries and the Individual Defendants. The case was closed on May 29, 2001. On June 11, 2001, the Court entered the Stipulation of Agreement.
On or about January 15, 1999, the Defendants filed a motion to dismiss the CAC. On September 28, 1999, the Court granted in part and denied in part the Defendants' motion to dismiss, and granted Plaintiffs leave to amend on certain claims. On December 8, 1999, Plaintiffs filed their second consolidated amended complaint ('SCAC'). On December 14, 1999, Plaintiffs served discovery on Defendants. On January 28, 2000, Defendants filed a motion to dismiss the SCAC. On February 4, 2000, the Court agreed with Defendants that Plaintiffs' discovery was improper because, under the Reform Act, discovery is stayed until the Court sustains the sufficiency of the SCAC. On February 28, 2000, the Plaintiffs filed an opposition to Defendants' motions to dismiss, and on March 15, 2000, Defendants filed their reply. Since then no information has been released by the company regarding the status of this case.
On or about April 23, 1998, several class action lawsuits were filed against the Company and its chief executive officer and then chief financial officer in the U.S. District Court for the Southern District of Texas, Houston Division. The first-filed complaint, styled Stanley Moskowitz V. Mitcham Industries, Inc., Billy F. Mitcham, Jr. and Roberto Rios, alleged violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934 and Sections 11 and 12(a)(2) of the Securities Act of 1933. On or about September 21, 1998, the complaints were consolidated into one action. On November 4, 1998, the plaintiffs filed a consolidated amended complaint ('CAC'), which sought class action status on behalf of those who purchased the Company's common stock from June 4, 1997 through March 26, 1998, and damages in an unspecified amount plus costs and attorney's fees. The CAC alleges that the Company made materially false and misleading statements and omissions in public filings and announcements concerning its business and its allowance for doubtful accounts.