According to the docket, on June 25, 2001, the Court entered the Opinion and Order #85745 granting the motion for an order approving the proposed settlement, granting the motion awarding plaintiffs' counsel attorneys' fees and the motion for reimbursing plaintiffs and their counsel their expenses in this litigation. Further, on September 4, 2001, the Court entered the Federal Final Judgment Order. The federal action was dismissed with prejudice.
In a press release dated May 1, 2001, the Dreyfus Corporation has tentatively agreed to pay $20.5 million to settle a federal class action lawsuit and a state lawsuit brought in 1998 by investors in two Dreyfus mutual funds. A joint hearing to approve the settlement is scheduled before a federal and state court judge on May 30. If the settlement is approved, investors who are parties to the federal lawsuit will share a cash settlement of $18.5 million, before attorneys' fees and expenses are deducted. Federal class members are identified as those who purchased shares of the Dreyfus Aggressive Growth Fund and the Premier Aggressive Growth Fund, or their predecessor funds, between Oct. 1, 1995 and June 8, 1998. The state lawsuit includes those investors who held shares of the same funds, or predecessor funds, from Aug. 1, 1995 through Sept. 30, 1995. These Dreyfus investors will split a $2 million settlement.
As summarized by the Notice of Pendency of Class Actions, Proposed Settlement and Settlement Hearing, beginning on June 19, 1998, investors in the Funds filed several putative class actions against certain of the Federal Defendants in the Federal Court. In an Order dated October 2, 1998, the Federal Court consolidated those lawsuits under the caption In re: Dreyfus Aggressive Growth Mutual Fund Litigation, No. 98 Civ. 4318 (HB). In Orders dated October 2, 1998 and June 8, 1999, the Court appointed certain investors in the Funds as the lead plaintiffs for the Federal Class and appointed the following firms as Colead Counsel for the Class: Shalov Stone & Bonner, Spector, Roseman & Kodroff, P.C.; and Stull Stull & Brody. Following the appointment of the lead plaintiffs and the Federal Co-lead Counsel, the Federal Plaintiffs filed a Consolidated Amended Complaint ("CAC") on November 12, 1998. On April 12, 1999, the Federal Defendants moved to dismiss the CAC. The Federal Court ruled on the Federal Defendants' motion to dismiss on January 5, 2000. In that ruling, the Federal Court sustained the Federal Plaintiffs' claims under §§ 11 and 12 of the 1933 Act and dismissed the Federal Plaintiffs' claims for violations of the 1940 Act and for breach of fiduciary duty. The Federal Plaintiffs filed their Second Amended Complaint ("SAC") on January 20, 2000. During a subsequent proceeding, the Court ruled that, pursuant to its January 5, 2000 Order, the Federal Plaintiffs would not be permitted to pursue their claim for violation of § 34(b) of the 1940 Act. On February 14, 2000, the Federal Plaintiffs moved the Court for an order certifying the Federal Class. On September 20, 2000, the Court granted the Federal Plaintiffs' motion for class certification in its entirety. After the Federal Court certified the Federal Class, the Federal Defendants petitioned the United States Court of Appeals for the Second Circuit to review the Federal Court's decision. On November 13, 2000, after the Federal Class Representatives and the Defendants had reached a tentative settlement of the Federal Action, the Federal Defendants agreed to withdraw that petition from active consideration without prejudice to its renewal.
The original complaint alleges violations of the federal Investment Company Act of 1940 and other claims, based on defendants' breach of their fiduciary duty to protect the interests of the Funds' investors. Plaintiff alleges that Schonberg, rather than investing in accordance with the Funds' stated investment objectives and criteria, used the Funds to invest in illiquid stocks in which Schonberg had large personal positions, on the basis of Schonberg's personal financial interests and without regard to the suitability of such investments for the Funds and their investors.