On July 11, 2007, the plaintiff gave notice of his appeal to the U.S. Court of Appeals for the Ninth Circuit from the Order Denying Motion for Payment of Damages and Motion to Award Attorneys’ Fees entered on June 13, 2007 and the Order Denying Motion for Reconsideration entered on June 29, 2007.

According to the latest docket posted, on February 24, 2004, the Court entered the Order by U.S. District Judge Claudia Wilken preliminarily approving the settlement and providing for notice. The Fairness Hearing was set for May 14, 2004. At the Hearing, Judge Wilken granted the motion for approval of plan of allocation of the settlement proceeds, the application for award of attorneys' fees and reimbursement of expenses, and the motion for final approval of the settlement. The Final Judgment and Order of Dismissal was entered that day.

In a press release dated January 5, 2004, Tut Systems, Inc. announced that it has reached settlements of the class action securities lawsuits that subsequently were consolidated. The Company also announced that it has reached a settlement of the derivative lawsuit entitled Lefkowitz v. D'Auria, et al., that was brought in the Superior Court of the State of California, County of Alameda. Subject to approval by the District Court, Tut Systems has agreed to pay $10 million to settle the consolidated class action lawsuits, which will be paid by the Company's insurance company. Subject to approval by the Superior Court, the derivative lawsuit settlement involves the Company's adoption of certain corporate governance measures and payment of attorneys' fees and expenses to the derivative plaintiff's counsel, which also will be paid by the Company's insurance company. Both settlements include releases of all defendants.

The original complaint charges Tut and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that defendants misrepresented the revenues that Tut was deriving from its sales to small competitive local exchange carriers which were not able to pay for the products purchased from Tut, causing Tut's sales to be inflated and its stock price to be artificially inflated to a Class Period high of $120.37 on 8/29/00. This upsurge in Tut's stock caused by defendants' false and misleading statements enabled the individual defendants to sell 87,100 shares of their Tut stock for proceeds of $8.1 million. By late 11/00, analysts learned that Tut's 4thQ 00 sales would be well below previously forecasted levels, causing the stock to decline. On 11/30/00, Tut revealed to the public that it was in fact suffering a huge decline in revenues, was not posting smaller negative earnings per share growth, and contrary to defendants' repeated assurances, Tut was forced to reveal the problems it had been experiencing during the Class Period in attempting to grow its business. This announcement caused the stock to drop to below $10 per share but the stock continued to trade at artificially inflated levels as defendants concealed the large amount of uncollectible receivables on Tut's books. Then on, 1/31/01, Tut announced huge write-offs of uncollectible accounts receivable and inventory, that its 4thQ 00 revenues had dropped to less than $6 million compared to more than $10 million in the 4thQ 99, and that it was laying off 10% of its workforce. This announcement caused its stock price to drop to as low as $5.84, causing hundreds of millions of dollars in damages to members of the Class.