According to the Company’s FORM 10-Q for the quarterly period ended June 30, 2002, the plaintiffs have stipulated to dismiss their appeal. On April 26, 2002, the federal court of appeals approved the parties' stipulation and ordered the appeal dismissed with prejudice.
As reported by the Company’s FORM 10-K for the fiscal year ended December 31, 2001, on March 8, 2002, the Court issued an order granting the motion and dismissing the complaint with prejudice as to all defendants. Plaintiffs could appeal this ruling to the Ninth Circuit Court of Appeals.
Previously, according to the same SEC filing, on October 30, 2000, a purported class action lawsuit was filed in federal district court in Los Angeles against SCE and Edison International. By agreement of the parties and the Court, plaintiffs amended their complaint on two occasions. Pursuant to this stipulation, on March 5, 2001, plaintiffs filed a second amended complaint. On March 15, 2001, a purported class action lawsuit was filed in federal district court in Los Angeles, California, against Edison International and SCE and certain of their officers. On August 3, 2001, the plaintiffs in both cases filed a consolidated complaint on behalf of alleged shareholders of Edison International, naming as defendants SCE, Edison International, and certain officers of Edison International. On September 17, 2001, the defendants filed a motion to dismiss for failure to state a claim.
The original complaint, a securities fraud class action lawsuit, commenced charging defendants with violations of the Securities Act of 1934 and Rule 10(b)(5) promulgated thereunder. The Complaint alleged securities fraud by Edison by its massive over reporting, up to the staggering amount of $2.358 billion, of revenue on Edison's financial statements for the second and third quarters of the year 2000.Its wholly owned subsidiary, So. Cal. Edison, has been purchasing electricity at double or triple the price it can sell it for under a rate freeze required under California's electricity deregulation law. Edison essentially accounted for this $2.358 billion in undercollections as revenue on its income and balance sheets, even though this amount has not been billed by Edison to its customers and is not billable by Edison under state law.