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Case Status:    SETTLED
On or around 09/10/2002 (Date of order of final judgment)

Filing Date: December 07, 2000

According to Gateway, Inc.'s SEC 10-Q filing for the quarterly period ended September 30, 2003, the parties and insurance carriers reached a $10.25 million settlement in which the Company denied all allegations and did not admit any liability. The settlement was funded entirely by the Company's insurance carriers and was approved by the court on September 9, 2002.

Additionally, the SEC filing said that on July 16, 2001, the complaints were consolidated and amended to allege among other things that the defendants misrepresented Gateway's financial performance in securities filings and in statements to the public. On September 13, 2001, defendants filed a motion to dismiss. On February 1, 2002, the court entered an order granting the defendants' motion to dismiss, but allowed the plaintiffs to file an amended complaint.

The original complaint charges Gateway and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Specifically, on October 12, 2000, Gateway reported its Q3 2000 financial results. The complaint alleges that these results were materially false and misleading as defendants failed to write down Gateway's impaired assets in order to inflate Gateway's financial results. Thereafter, defendants issued a series of allegedly false and misleading statements concerning the company's business and its prospects for Q4 2000. The complaint charges that defendants actually knew that Gateway's business was faltering, that is Q3 results were false, and that its Q4 results would show no growth and would devastate Gateway's share price. Despite this actual knowledge, defendants claimed that Gateway would achieve EPS growth of almost 50% in Q4 and even went so far as to claim that Gateway shares were significantly undervalued. On November 29, 2000, defendants admitted Gateway would not achieve Q4 growth of almost 50% but instead would report potential losses and absolutely no growth at all. Defendants' release also revealed that Gateway would take a $200 million charge for impairment in Q4. In reality, most of this write-down should have been taken in Q3. The market reaction to the news was devastating. In minutes, Gateway lost several billion dollars of market capitalization resulting in losses to thousands of Gateway shareholders, as Gateway's stock price declined from $31 to $19 in two days, on huge volume of 23.2 million shares.

COMPANY INFORMATION:

Sector: Technology
Industry: Computer Hardware
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: GTW
Company Market: New York SE
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. California
DOCKET #: 00-CV-2435
JUDGE: Hon. Rudi M. Brewster
DATE FILED: 12/07/2000
CLASS PERIOD START: 10/13/2000
CLASS PERIOD END: 11/29/2000
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernstein Litowitz Berger & Grossmann LLP (Westfield, NJ)
    220 St. Paul Street, Bernstein Litowitz Berger & Grossmann LLP (Westfield, NJ), NJ 07090
    908.928.1700 908.301.9008 · blbg@blbglaw.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. Spector, Roseman & Kodroff (Philadelphia)
    1818 Market Street; Suite 2500, Spector, Roseman & Kodroff (Philadelphia), PA 19103
    215.496.0300 215.496.6610 · classaction@srk-law.com
  5. 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. California
DOCKET #: 00-CV-2435
JUDGE: Hon. Rudi M. Brewster
DATE FILED: 07/16/2001
CLASS PERIOD START: 04/14/2000
CLASS PERIOD END: 02/28/2001
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernstein Litowitz Berger & Grossmann LLP (former San Diego)
    12544 High Bluff Drive, Suite 150, Bernstein Litowitz Berger & Grossmann LLP (former San Diego), CA 92130
    858.793.0070 858.793.0323 · blbg@blbglaw.com
  2. 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
  3. 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
No Document Title Filing Date