According to the docket dated February 03, 2003, on January 31, 2001 the court approved the settlement terminating the case.
On February 9, 1998, the plaintiffs filed an amended complaint. The complaint alleged that Citizens and the individual defendants, during such period, violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based upon certain public statements made by the Company, which are alleged to be materially false or misleading, or are alleged to have failed to disclose information necessary to make the statements made not false or misleading. The plaintiffs sought to recover unspecified compensatory damages. The Company and the individual defendants believed the allegations are unfounded and filed a motion to dismiss on March 27, 1998 and on March 30, 1999 the Court dismissed the action. On April 29, 1999 the plaintiffs filed a notice of appeal with the Court of Appeals for the Second Circuit. The parties have entered into a settlement stipulation which
is subject to the District Court's approval.
The original complaint alleges that Citizens and certain officers and directors of the Company during the relevant time period violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, by, among other things, misrepresenting material information concerning the Company's telecommunications expansion. In particular, the complaint alleges that defendants misrepresented and failed to disclose at all relevant times that the Company's entrance into the long-distance telephone market was failing and that the Company would be forced to scale back its expansion plans and record a $185 million asset writedown.