According to the docket, on September 30, 1996, the defendants filed several motions to dismiss the complaint. On February 24, 1996, U.S. District Court Judge Judith N. Keep issued an Order granting the defendants’ motions to dismiss. The Court dismissed all plaintiff’s claims against all defendants with prejudice. On December 24, 1996, the Court entered the Clerk’s Judgment, and on January 6, 1997, the plaintiff filed a Notice of Appeal from the District Court’s decision. On June 30, 1998, the Court entered the copy of the judgment from the U.S. Court of Appeals, affirming the decision of the District Court.
The complaint charges Hart Brewing, certain of its officers, directors, underwriters, and certain selling shareholders with violations of the federal securities laws by, among other things, violating disclosure requirements in connection with its December, 1995 IPO. The non-disclosure of the Company's performance and ability to compete served to inflate the offering price of Hart Brewing common stock until subsequently the true facts about Hart Brewing's performance and ability to compete were ultimately disclosed. In addition, the management of Hart Brewing knew of these negative facts at the time of its public offering. The failure to discuss material facts about the performance of Hart Brewing altered the total mix of material information provided to investors. Plaintiff specifically alleges defendants knew, but withheld from the public, materially adverse facts which revealed that before December 13, 1995, the effective date of the public offering, Hart Brewing had experienced adverse trends which had a material impact on its barrels sold, net sales, operating income, income before taxes, and pro forma net income.