According to the docket posted, on January 19, 2001, the Court entered the Stipulation and Order dismissing defendants Flemington Pharmaceuticals and two of its officers. The case continued against the remaining defendants, Monroe Parker Securities and two of its principals. On November 28, 2001, the Court entered the Judgment for plaintiff and against the remaining defendants in the sum of $316,571.51. The Court granted the plaintiff’s motion for default judgment against Monroe Parker Securities and two of its principals.

According to the Company’s FORM 10-QSB for the six month period ended January 31, 2001, on December 8, 2000 the lawsuit was dismissed with prejudice. Pursuant to the settlement agreement, the exact terms remain confidential.

As summarized by the Company’s FORM 10-QSB for the three month period ended October 31, 2000, on March 25, 1999, the Company filed a motion to dismiss the complaint for failure to state a cause of action. In October, 1999, the United States District Court granted the Company's motion in part and denied it in part. On November 8, 2000, Plaintiff's Motion for Class Certification was dismissed by the court and Plaintiff did not appeal that denial. Subsequently, the Company and Plaintiff reached agreement on the terms of a settlement of the action, A formal settlement agreement, including a dismissal of the lawsuit with prejudice, is in the process of being finalized.

The complaint alleges violations of Sections 11, 12 and 15 of the Securities Act of 1933 against the Company, two of its officers, Mr. Dugger and Mr. Moroney (with the Company, the "Flemington Defendants"), Monroe Parker Securities and two of its principals, Alan Lipsky and Bryan Herman (collectively, the "Monroe Parker Defendants"). The complaint also alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 against the Monroe Parker Defendants. All allegations in the complaint arise out of the initial public offering of the Company's securities pursuant to a Registration Statement dated November 19, 1997. The complaint alleges that the Flemington Defendants committed securities laws violations by omitting material facts from the Prospectus; specifically that: (1) the cessation of market-making activities by Monroe Parker would result in an immediate substantial drop in the market price of the Company's securities; (2) Monroe Parker would be unable to maintain market maker activities for the Company's securities because Monroe Parker had been violating the securities laws and therefore the NASD or law enforcement officials were likely to take action to put Monroe Parker out of business; (3) Monroe Parker had been violating the federal securities laws by controlling the market for securities for which it was a market maker, running up the price of securities through various illegal tactics, and after amassing illegal profits, allowing the market price to collapse by declining to purchase the securities except at an extremely low price; and (4) defendants Lipsky and Herman had been principals of Biltmore Securities until they started Monroe Parker. The complaint further alleges a violation of Section 12(2) of the Securities Act by alleging that the Flemington Defendants were "sellers" of the Company's securities purchased by the plaintiff.