On August 20, 2003, the Court entered the certified copies of the Opinion and Judgment of the U.S. Court of Appeals for the Fifth Circuit Court affirming the judgment of the District Court.
On September 24, 2002, the plaintiffs filed a motion to set aside the March 29, 2002 Final Judgment, and On March 6, 2003, the Court issued the Memorandum Opinion and Order denying that motion. On March 18, 2003, the plaintiffs filed another Notice of Appeal from the Memorandum Opinion and Order denying the motions to set aside Judgment.
According to the Company’s FORM 10-Q for the quarterly period ended March 31, 2002, on March 29, 2002, the district court granted the motion to dismiss the consolidated amended complaint filed by WorldCom and the individual defendants, and it entered final judgment dismissing the complaint with prejudice. On April 4, 2002, plaintiffs filed a notice of appeal to the U.S. Court of Appeals for the Fifth Circuit.
As summarized by the same SEC filing, in November 2000, class action complaints were filed in the United States District Courts for the Southern District of Mississippi, the Southern District of New York, and the District of Columbia against WorldCom and some of our executive officers. All of these actions were consolidated in the Southern District of Mississippi on March 27, 2001, along with another purported class action lawsuit filed on behalf of individuals who purchased stock in Intermedia
between September 5 and November 1, 2000, which action asserted substantially
similar claims and alleges that after the announcement of the WorldCom-Intermedia merger, the price of Intermedia stock was tied to the price of WorldCom stock. On June 1, 2001, the plaintiffs filed a consolidated amended complaint. Among other things, the consolidated amended complaint alleged that statements regarding WorldCom's revenues, the integration of MCI, the success of UUNET Technologies, and the expansion of WorldCom's network were false; WorldCom's financial disclosures were false; and WorldCom's announcement of its "generation d" initiative was misleading. Based on these allegations, the consolidated amended complaint asserts claims for violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder and Section 20(a) of the Securities Exchange Act of 1934. The consolidated amended complaint seeks to certify a class of persons who purchased WorldCom shares between February 10, 2000 and November 1, 2000, inclusive; it does not assert separate claims on behalf of purchasers of Intermedia shares.
According to a Press Release dated December 15, 2000, a lawsuit in the United States District Court for the Southern District of Mississippi, on behalf of a class (the "Class") consisting of all purchasers of Intermedia Communications, Inc. (NASDAQ: ICIX-news) common stock during the period between September 5, 2000 and November 1, 2000, inclusive. The defendants are WorldCom, Inc., WorldCom's Chief Executive Officer and its Chief Financial Officer. The claims arise under Sections 10(b) and Section 20(a) of the Securities Exchange Act of 1934 and Rul 10b-5 promulgated thereunder by the Securities and Exchange Commission ("SEC"). The complaint alleges that defendants made a series of materially false and misleading statements in press releases and SEC filings concerning: the effect of the failure of WorldCom's proposed merger with Sprint, particularly with regard to the impact of lost cost savings and revenues, the difficulties experienced in relation to WorldCom's acquisition of MCI; WorldCom's decreasing growth rates; and WorldCom's growing uncollectable receivables, which were not accurately reflected in its financial statements. The complaint further alleges that these material misstatements of fact enabled WorldCom,on September 5, 2000, to enter into an agreement to acquire Intermedia, for WorldCom stock, the price of which was artificially inflated at that time, and causing Intermedia's stock to be pegged to the market price of WorldCom shares. Plaintiff and other similarly situated purchasers of Intermedia Communications stock have been damaged by purchasing their stock at inflated prices. The stock dropped significantly as the true facts concerning WorldCom's business affairs began to be revealed on November 1, 2000.
The first filed complaint charges WorldCom and certain of its officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5. The complaint alleges that Defendants made a series of materially false and misleading statements in press releases and SEC filings. These misrepresentations concerned: the effect of the Company's acquisition of MCI; the Company's decreasing growth rates; the Defendants' dependence on the revenue stream from the proposed Sprint merger; and the Company's receivables as reflected in its financial statements. As a result of these misrepresentations, WorldCom's stock price was artificially inflated throughout the Class Period, damaging Plaintiff and the Class he seeks to represent.