According to the latest docket posted, on March 19, 2002, the Court entered the Orders granting the motion for an order to consolidate several cases and granting the motion to appoint lead plaintiff and co-lead counsel. On May 6, 2002, the plaintiffs filed a Consolidated Class Action Amended Complaint, and the defendants responded by filing a motion to dismiss the complaint. On March 6, 2003, the Court entered the Order denying the defendants’ motion to dismiss the complaint. The plaintiffs then filed a Second Consolidated Class Action Complaint on June 9, 2003. On August 1, 2003, the individual defendants filed a motion to dismiss the Second Amended Complaint. On August 20, 2003, Loral Space & Communications filed a suggestion of bankruptcy. On March 2, 2004, the Court entered the Memorandum and Opinion # 89735. According to the Memorandum, the Court has considered all of the remaining arguments of the parties, and they are either moot or without merit. For the reasons stated, the defendants' motion to dismiss the claims in the amended complaint against the individual defendants is granted. On May 31, 2005, the Court issued an Order administratively closing the case.
The complaint was filed against Loral Space & Communications Ltd. The complaint alleges violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The complaint alleges that the defendants made material misrepresentations and omissions of material facts concerning the company's business performance during the relevant time. The complaint alleges that these statements failed to disclose that Globalstar was experiencing regulatory problems and delays in receiving necessary European approvals to achieve sales in conformity with Globalstar's stated business plans. In fact, undisclosed regulatory delays effectively prevented sales in Europe until approximately April or May of 2000. Moreover, the statements failed to disclose that Globalstar's business plans were predicated primarily on sales in developed nations and that Globalstar phones did not offer ``roaming'' service, rendering them uncompetitive in developed nations. Furthermore, defendant Schwartz's statements about the number of phones by December 31, 1999 and December 31, 2000 were materially false. Defendant Schwartz had no basis for making such statements. Indeed, defendant Schwartz was in a clear position to know that Globalstar's projections were entirely without basis and that by December 31, 1999, Globalstar would not sell phones or achieve subscriptions in remotely those numbers.