Case Page

 

Case Status:    DISMISSED    
On or around 03/31/2005 (Date of order of final judgment)

Filing Date: August 24, 2000

According to a press release dated April 30, 2005, the U.S. District Court for the Southern District of New York granted a motion to dismiss the second consolidated class action complaint by a class of Federated Dep't Stores Inc. investors alleging securities fraud by Federated and three of its directors and officers. … The district court held that a motive to maintain the appearance of corporate profitability or investment success did not sufficiently plead scienter as these motives would apply to any corporate defendant. The district court also found that the complaint failed to sufficiently allege recklessness by showing that Federated or its officers knew or should have known about the customer receivable problems of Fingerhut. The complaint contained conclusions and failed to specify facts contained in the audits or review meetings which Federated and its officers possessed that would contradict the allegedly fraudulent public statements.

As previously reported by the Company’s FORM 10-K for the Fiscal Year Ended January 29, 2005, the Company filed a Motion to Dismiss the Complaint on January 22, 2002, and on March 11, 2004, the court dismissed the Complaint without prejudice. On May 18, 2004, the plaintiffs filed a second amended complaint (the “Second Amended Complaint”), asserting the same claims as in the earlier versions of the Complaint. The Company filed a Motion to Dismiss the Second Amended Complaint on July 7, 2004, and is awaiting a response from the Court.

The original complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between February 23, 2000, and July 20, 2000. For example, as alleged in the complaint, on February 23, 2000, Federated issued a press release announcing its financial results for its 1999 fiscal year, which highlighted an 18% increase in year-over-year earnings per share. This statement, the complaint alleges, was materially false and misleading because Federated failed to disclose that it had materially under-reserved for credit delinquencies in its Federated Direct division, which was largely composed of Fingerhut Inc.- a Federated subsidiary.

When the Company revealed, in a July 20, 2000, press release, that rising
credit delinquencies coupled with insufficient reserves for such defaults, would lead to, among other things, a $200-$250 million shortfall in Federated's fall earnings, the Company's stock price plunged by 15% to $23.5 per share-which represented a 44% drop from the class period high of $42.0625 per share on March 21, 2000.

COMPANY INFORMATION:

Sector: Services
Industry: Retail (Department & Discount)
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: FD
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: S.D. New York
DOCKET #: 00-CV-6362
JUDGE: Hon. Richard C. Casey
DATE FILED: 08/24/2000
CLASS PERIOD START: 02/23/2000
CLASS PERIOD END: 07/20/2000
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernstein Liebhard & Lifshitz, LLP (New York)
    10 E. 40th Street, 22nd Floor, Bernstein Liebhard & Lifshitz, LLP (New York), NY 10016
    800.217.1522 · info@bernlieb.com
  2. Cauley, Geller, Bowman, Coates & Rudman LLP (San Diego, CA)
    225 Broadway, Suite 1900, Cauley, Geller, Bowman, Coates & Rudman LLP (San Diego, CA), CA 92010
    619.702.7350 619.702.7351 ·
  3. Law Offices of Charles J. Piven, P.A.
    World Trade Center-Baltimore,401 East Pratt Suite 2525, Law Offices of Charles J. Piven, P.A., MD 21202
    410.332.0030 · pivenlaw@erols.com
  4. Leo W. Desmond
    2161 Palm Beach Lakes Boulevard, Suite 204, Leo W. Desmond, FL 33409
    561.712.8000 561.712.8000 · stocklaw@bellsouth.net
  5. Milberg Weiss Bershad Hynes & Lerach LLP (San Diego, CA)
    600 West Broadway, 1800 One America Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (San Diego, CA), CA 92101
    800.449.4900 · support@milberg.com
  6. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
  7. 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
COURT: S.D. New York
DOCKET #: 00-CV-6362
JUDGE: Hon. Richard C. Casey
DATE FILED: 05/18/2004
CLASS PERIOD START: 02/23/2000
CLASS PERIOD END: 07/20/2000
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernstein Liebhard & Lifshitz, LLP (New York)
    10 E. 40th Street, 22nd Floor, Bernstein Liebhard & Lifshitz, LLP (New York), NY 10016
    800.217.1522 · info@bernlieb.com
  2. Lerach Coughlin Stoia Geller Rudman & Robbins LLP (Melville)
    200 Broadhollow, Suite 406, Lerach Coughlin Stoia Geller Rudman & Robbins LLP (Melville), NY 11747
    631.367.7100 631.367.1173 · info@lerachlaw.com
  3. Milberg Weiss Bershad & Schulman LLP (New York)
    One Pennsylvania Plaza, 49th Floor, Milberg Weiss Bershad & Schulman LLP (New York), NY 10119
    212.594.5300 212.868.1229 · info@milbergweiss.com
  4. 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 ·
  5. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
No Document Title Filing Date