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Case Status:    SETTLED
On or around 05/04/1999 (Date of order of final judgment)

Filing Date: March 18, 1998

According to the docket, dated September 28, 2000, the Eleventh Circuit Court of Appeals issued an Order dismissing the appeal with prejudice.

By the Order and Final Judgment, dated April 30, 1999, U.S. District Judge Susan C. Bucklew certified the action as a class action and approved the settlement. According to Digital Lightwave’s Form 10-Q For The Quarterly Period Ended June 30, 1999, the Company reported a settlement of $4.3 million in cash, to be paid to plaintiffs primarily by a claim on the Company's directors and officers liability insurance policy, and the issuance of up to 1.8 million shares of Common Stock. The Company recorded a one-time charge of $8.5 million during 1998 as a result of the settlement. A Notice of Appeal was filed by plaintiff Charles D. Chalmers on May 20, 1999.

The Complaint names Digital 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 10b-5 promulgated thereunder, by originating a series of materially misleading statements and omissions concerning the Company's business prospects and valuation of inventory. Specifically, Plaintiff alleges that the Defendants knowingly or recklessly misrepresented the Company's financial status during the Class Period by wrongfully recognizing revenues from certain shipments to distributors. As a result of these wrongful recognitions of revenue, Plaintiff alleges that the Company overstated revenue for the second quarter of 1997 by at least $2.6 million, and by at least $6.9 million for the third quarter. As a consequence of these overstatements of revenue, Plaintiff alleges that the defendants misrepresented the growth and profitability for the Company at all times during the Class Period, thereby artificially inflating the share price at all relevant times. During the Class Period, Digital insiders sold tens of thousands of shares at these artificially inflated prices. On Jan. 23, 1998, Digital shocked the market by announcing that it would restate its previously reported revenues for the second and third quarters of 1997. Specifically, the release indicated that the second quarter revenues would be restated from $5.3 million to $2.7 million and that third quarter revenues would be restated from $8.3 million to $1.4 million, that the decision to restate the 1997 results of operations resulted from the "discovery of certain errors in the timing of revenue recognition and a review of related accounting policies and procedures." The Company also announced that after consideration of the uncertainty in various international markets, the company has instituted a policy of deferring recognition of revenues on sales to international distributors until the product is actually sold to its end user customer. The press release further indicated that the Company had established a committee of outside directors to "review" its accounting policies. The price of Digital stock plummeted in response to this announcement, dropping $6.625 per share to close at $4.50 per share. This drop represented a decline of 59 percent from the previously prevailing market price.

COMPANY INFORMATION:

Sector: Technology
Industry: Communications Equipment
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: DIGL
Company Market: NASDAQ
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: M.D. Florida
DOCKET #: 98-CV-00152
JUDGE: Hon. Susan C. Bucklew
DATE FILED: 03/18/1998
CLASS PERIOD START: 05/05/1997
CLASS PERIOD END: 01/22/1998
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Berman DeValerio Pease Tabacco Burt & Pucillo (MA)
    One Liberty Square, Berman DeValerio Pease Tabacco Burt & Pucillo (MA), MA 2109
    617.542.8300 617.230.0903 · info@bermanesq.com
  2. Burt & Pucillo LLP
    515 North Flagler Drive, Northbridge Centre, Suite 1701, Burt & Pucillo LLP, FL 33401
    800.349.4612 ·
  3. Pomerantz LLP (New York)
    600 Third Avenue, Pomerantz LLP (New York), NY 10016
    212.661.1100 212.661.8665 · info@pomerantzlaw.com/
No Document Title Filing Date
COURT: M.D. Florida
DOCKET #: 98-CV-00152
JUDGE: Hon. Susan C. Bucklew
DATE FILED: 09/04/1998
CLASS PERIOD START: 02/06/1997
CLASS PERIOD END: 01/22/1998
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Barrack, Rodos & Bacine (Main office, Philadelphia)
    Two Commerce Square, 2001 Market Street, Suite 3300 , Barrack, Rodos & Bacine (Main office, Philadelphia), PA 19103
    215.963.0600 215.963.0838 · info@barrack.com
  2. Berman DeValerio Pease Tabacco Burt & Pucillo (MA)
    One Liberty Square, Berman DeValerio Pease Tabacco Burt & Pucillo (MA), MA 2109
    617.542.8300 617.230.0903 · info@bermanesq.com
  3. Burt & Pucillo LLP
    515 North Flagler Drive, Northbridge Centre, Suite 1701, Burt & Pucillo LLP, FL 33401
    800.349.4612 ·
  4. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
No Document Title Filing Date
No Document Title Filing Date