Case Page

 

Case Status:    SETTLED
On or around 09/13/2001 (Date of order of final judgment)

Filing Date: March 02, 1999

According to Smart Choice’s Form 10-Q for the fiscal quarter ended October 31, 2000, the Company recorded $2.5 million to settle the action. The entire $2.5 million settlement amount was funded by Smart Choice's insurance carrier.

On March 14, 2003, the Court entered the Order by U.S. District Judge John Antoon II granting the motion for the distribution of the class settlement fund. Earlier, on January 17, 2003, the Court entered the Order granting in part and denying in part the motion for attorney fees and reimbursement of expenses. Plaintiffs' Counsel was awarded attorneys' fees in the amount of $750,000, plus interest earned, and reimbursement of expenses in the amount of $36,657.74. The motion for $3,422.68 in additional expenses was denied. On September 13, 2001, the Court entered the Order and Final Judgment by Judge John Antoon II approving the proposed Settlement as fair, reasonable and adequate, and the compliant was dismissed with prejudice.

The complaint alleges defendants Smart Choice, its CFO, and Smart Choice's founder and CEO issued a series of false and misleading statements in the company's quarterly reports that artificially inflated the price of Smart Choice shares.
Specifically, the complaint alleges that Smart Choice had been struggling with a low stock price since the middle of 1998. Its stock problems intensified after a one-for-two reverse stock split in August and the cancellation of a second stock offering in September. By the time the year-end report was released Feb. 10, Smart Choice's stock had plunged to nearly $4 a share. The complaint further alleges that in the report, Smart Choice announced it would sell its new-car dealerships and its aftermarket auto-parts subsidiary, Eckler Industries Inc., to concentrate on its more profitable used-car business. Before Smart Choice withdrew the earnings report, at least two analysts praised the decision to divest the two businesses. They said Smart Choice needed the capital to open more used-car lots, especially after it had canceled the second stock offering. Also in the year-end report, Smart Choice said its used-car chain in 1998 sold 8,329 used vehicles for $84.6 million, up from $35.3 million in 1997. In the same report, Smart Choice reported overall net income of $4.61 million for 1998, compared with a net loss of $18.6 million in 1997. However, just 16 days later, Smart Choice withdrew the report and announced the resignation of its CFO. Smart Choice released a statement that said its net income "was likely overstated in a material, presently undetermined, amount."

COMPANY INFORMATION:

Sector: Services
Industry: Retail (Specialty)
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: SMCH
Company Market: NASDAQ
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: M.D. Florida
DOCKET #: 99-CV-237
JUDGE: Hon. G. Kendall Sharp
DATE FILED: 03/02/1999
CLASS PERIOD START: 04/15/1998
CLASS PERIOD END: 02/26/1999
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
    One Pennsylvania Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY), NY 10119-1065
    212.594.5300 ·
No Document Title Filing Date
COURT: M.D. Florida
DOCKET #: 99-CV-237
JUDGE: Hon. G. Kendall Sharp
DATE FILED: 07/30/1999
CLASS PERIOD START: 04/15/1998
CLASS PERIOD END: 02/26/1999
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Geller Rudman, PLLC.
    197 South Federal Highway, Suite 200, Geller Rudman, PLLC., FL 33432
    561.750.3000 888.262.3131 · info@geller-rudman.com
  2. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
    One Pennsylvania Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY), NY 10119-1065
    212.594.5300 ·
  3. Stull, Stull & Brody (New York)
    6 East 45th Street, Stull, Stull & Brody (New York), NY 10017
    310.209.2468 310.209.2087 · SSBNY@aol.com
No Document Title Filing Date