According to the latest docket posted, on March 26, 2002, the Court entered the certified copy of the Order from the U.S. Court Appeals, Second Circuit, dismissing the appeal.
As previously reported by the Company’s FORM 10-Q for the quarterly period ended September 30, 2001, the Company's motion to dismiss the complaint was granted with leave to amend in April 2000. The plaintiffs subsequently filed an amended complaint in July 2000, and the Company again filed a motion to dismiss. In September 2001, the motion to dismiss the amended complaint was granted with prejudice, and the plaintiffs appealed that decision to the Ninth Circuit Court of Appeals in October 2001.
The original complaint alleges that throughout the Class Period, defendants represented to the investing public that the present and future business and financial prospects of the Company were not only stable but in a stage of explosive growth so that defendants could sell over $34,590,000 of their own holdings in the Company at artificially inflated prices. The complaint further alleges that defendants were only able to exceed analysts' earnings estimates and report quarter-to-quarter earnings growth by failing to take required write-offs associated with accounts receivable and obsolete technology which were required for a proper representation of the Company's operating results. As a result of defendants' false and misleading statements and/or omissions, Adaptec's stock traded as high as $53 3/16 per share during the Class Period. On Jan. 8, 1998, Adaptec ultimately revealed to the financial community it would suffer an enormous revenue shortfall for its third quarter ended Dec. 31, 1997. As a result of these disclosures, the price of Adaptec common stock plummeted from $35 15/16, on January 8, 1998, to $21 9/16 on January 9, 1998 on volume of 26,982,700 shares -- a drop of 40% in one day and a drop of approximately 60% from the stock's high of $53 3/16 on October 7, 1997.