According to the docket, on October 1, 2001, the Court entered the Order and Final Judgment signed by U.S. District Judge William C. Conner. By the Order and Final Judgment, the Consolidated Complaint, and the Original Pleadings, are hereby dismissed with prejudice and without costs, except as provided in this Stipulation. Plaintiffs' Counsel are hereby awarded (i) $1,050,705.00 in fees equivalent to 33 and one third% of the $3.2 million Settlement Fund (after deducting expenses of $47,884.00 awarded pursuant to this Order), which sum the Court finds to be fair and reasonable, and (ii) $45,532.00 in reimbursement of expenses. John P. Sankey, one of the Class Representatives, is reimbursed $2,352.00 for his reasonable costs and expenses (including lost wages) directly related to his representation of the Class. The case is closed.
As reported by the Company’s Form 10-Q For The Quarter Ended May 31, 2001, on May 30, 2001, the parties to the Class Action entered into a Stipulation of Settlement to settle the Class Action. Under the terms of the Stipulation, the Company's insurers have paid into escrow an aggregate of $3.2 million in settlement of the Action. The settlement is subject to a number of contingencies, including the final approval of the District Court, and the entry of an Order and Final Judgment by the District Court. By Order dated June 13, 2001, the District Court gave preliminary approval to the proposed settlement, subject to notice to class members, and a hearing for final approval, which the District Court has scheduled for September 21, 2001. There can be no assurance that the District Court will finally approve the Settlement.
As reported by the Company’s Form 10-K For The Fiscal Year Ended November 30, 1999, on September 18, 1998, the District Court ordered that the three actions be
consolidated, appointed a group of lead plaintiffs in the consolidated actions,
approved the lead plaintiffs selection of counsel for the purported class in the
consolidated actions, and directed the lead plaintiffs to file a consolidated
complaint. The consolidated and amended class action complaint ("Consolidated
Complaint") which has been filed asserts the same legal claims based on
essentially the same factual allegations as did the Complaints. On February 19,
1999, the Company and the Individual Defendants filed a motion to dismiss the
Consolidated Complaint. The District Court has denied the motion to dismiss. The
Company and the Individual Defendants have answered the Consolidated Complaint,
denying all liability and raising various affirmative defenses. Discovery has
The original complaint alleges that defendants misrepresented, beginning July 15, 1997, that Quintel had achieved record operating results for the quarter ended May 31, 1997, as a result of improved collection procedures from customers of its psychic telephone hotline, and Quintel's expanded business relationship with AT&T. In fact, defendants knew, during the Class Period, that Quintel was continuing to experience poor collections from customers and would have to increase materially its allowance for reserves to reflect its actual experience with nonpayment, and that AT&T had sharply curtailed its business relationship with Quintel.