According to the Company’s FORM 10-Q For the Quarterly Period Ended March 31, 2000, in an opinion dated May 5, 2000, the Court of Appeals affirmed in all respects the orders of the District Court that the plaintiffs had appealed.
As reported by the same SEC filing, the plaintiffs amended the complaint on October 16, 1998. The plaintiffs purport to represent a class of all persons who purchased or otherwise acquired our common stock in the period from April 17, 1997 through March 31, 1998. The amended complaint alleges, among other things, that the defendants knowingly made misstatements to the investing public about the value of our inventory and the nature of the Company’s accounting practices. On December 15, 1998, the Company filed a motion to dismiss the case in its entirety based on the pleadings. The Company’s motion to dismiss was granted without prejudice on May 27, 1999 and the case was closed by the court on June 1, 1999. On June 29, 1999, the plaintiffs filed a motion with the court seeking permission to file a second amended complaint. The Company opposed that motion. On July 13, 1999, the court denied the plaintiffs' motion to amend, noting "final judgment having entered the case." On July 26, 1999, the plaintiffs filed a motion with the court asking the court to extend the 30-day period for filing an appeal of its ruling dismissing the case. The Company opposed that motion as well, and the court denied the motion on August 10, 1999. The plaintiffs filed an appeal with the United States Court of Appeals for the First Circuit requesting that the Court of Appeals reverse each of the orders described above.
The original Complaint charges ACT and certain of its officers with violations of federal securities laws. Plaintiff complains that ACT's results, as reported by defendants, did not accurately reflect ACT's true financial position and results of operations. Late on February 25, 1998, ACT first announced it has postponed reporting fourth- quarter and full-year results, citing a significant inventory shortfall that it expected to have a material impact on operating results. The next day ACT's stock plummeted, losing more than a quarter of its value.