According to a Press Release dated June 28, 2001, a class action lawsuit was filed against eToys, Inc. The complaint alleges that eToys Inc., its President and Chief Executive Officer at the time of its IPO, and its CFO at the time of its IPO violated the federal securities laws by issuing and selling eToys common stock pursuant to the initial public offering without disclosing to investors that three of the lead underwriters of the IPO had solicited and received excessive and undisclosed commissions from certain investors. In exchange for the excessive commissions, the complaint alleges, lead underwriters The Goldman Sachs Group, Inc., FleetBoston Robertson Stephens, Inc., and Merrill Lynch, Pierce, Fenner & Smith Inc. allocated eToys shares to customers at the IPO price of $20.00 per share. To receive the allocations (i.e., the ability to purchase shares) at $20.00, the defendant lead underwriters' brokerage customers had to agree to purchase additional shares in the aftermarket at progressively higher prices. The requirement that customers make additional purchases at progressively higher prices as the price of eToys stock rocketed upward (a practice known on Wall Street as ``laddering'') was intended to (and did) drive eToys's share price up to artificially high levels. This artificial price inflation, the complaint alleges, enabled both the defendant lead underwriters and their customers to reap enormous profits by buying eToys stock at the $20.00 IPO price and then selling it later for a profit at inflated aftermarket prices, which rose as high as $85.00 during its first day of trading. Rather than allowing their customers to keep their profits from the IPO, the complaint alleges, the defendant lead underwriters required their customers to ``kick back'' some of their profits in the form of secret commissions. These secret commission payments were sometimes calculated after the fact based on how much profit each investor had made from his or her IPO stock allocation. The complaint further alleges that defendants violated the Securities Act of 1933 because the Prospectus distributed to investors and the Registration Statement filed with the SEC in order to gain regulatory approval for the eToys offering contained material misstatements regarding the commissions that the underwriters would derive from the IPO and failed to disclose the additional commissions and ``laddering'' scheme discussed above.