According to the docket posted, on November 21, 2001, the Court entered the Final Judgment and Order of Dismissal with prejudice. The settlement was approved and the case closed.
By the Notice of Proposed Settlement of Class Action, a settlement hearing will be held on November 2, 2001, at 8:30 a.m., before the Honorable Roslyn O. Silver, United States District Judge, at the United States Courthouse, District of Arizona, 401 West Washington, Phoenix, Arizona 85003 (the "Settlement Hearing"). The purpose of the Settlement Hearing will be to determine: (1) whether the settlement consisting of $3,625,000 in cash plus accrued interest should be approved as fair, just, reasonable and adequate to each of the parties; (2) whether the proposed plan to distribute the settlement proceeds (the "Plan of Allocation") is fair, just, reasonable, and adequate; (3) whether Lead Counsel have adequately represented the Class; (4) whether the application by Representative Plaintiffs' Counsel for an award of attorneys' fees and expenses should be approved; and (5) whether the Litigation should be dismissed with prejudice. The Court may adjourn or continue the Settlement Hearing without further notice to the Class.
As reported by the Company’s FORM 10-K For the Fiscal Year Ended December 31, 1999, the four class actions have been consolidated by The Honorable Roslyn O. Silver of the United States District Court for the District of Arizona. The court has recently appointed the lead plaintiffs and lead counsel.
Four class action lawsuits have been filed on behalf of purchasers of the Company’s common stock in the U.S. District Court for the District of Arizona against the Company and certain of its present and former officers alleging violations of the federal securities laws.
The allegations of each of the complaints are very similar. The class period alleged in each of the actions is May 5, 1998 through November 29, 1999. In general, the actions claim that during the class period, the Company reported increasing sales and earnings before interest, taxes, depreciation, and amortization which caused the Company’s common stock to trade at artificially inflated prices. The complaints allege that the price of the Company’s common stock dropped significantly when the Company announced that its third quarter 1999 revenues and earnings would fall short of market expectations. The complaints further allege that on November 29, 1999, the Company announced that it could not file its Form 10-Q for the quarter ended September 30, 1999 because of revenue recognition issues and allegedly admitted that the Company’s results for the first two quarters of 1999 and for the year ended December 31, 1998 were misstated and would have to be restated due to errors and irregularities relating to the Company’s Body Drench division. The complaints further allege that as a result of the facts stated above, trading in the Company’s common stock was halted and the Company’s common stock was delisted by Nasdaq. The plaintiffs claim that the Company caused the stock to trade at artificially inflated prices during the class period.
The complaints further allege violations of Section 10(b) of the 1934 Act and Rule 10(b)(5) for (a) employing devices, schemes and artifices to defraud; (b) making untrue statements of material fact or omitting to state material facts such that they would not be misleading; (c) engaging in acts, practices, and a course of business that operated as a fraud or deceit upon plaintiff and class members. The complaints also allege violations of Section 20(a) of the 1934 Act by the Company and claim that the plaintiffs and other class members relied on statements made by the Company that lead them to purchase stock they would not have otherwise purchased. The complaints do not make a specific prayer for monetary relief. The complaints simply claim that plaintiffs and members of the class should be awarded damages, interest, costs, attorneys' fees, expert witness fees, and other costs and expenses.