According to the docket, on October 5, 2001, the Court entered the Stipulation and Order of dismissal of the action pursuant to Rules 41(a) and 23(e) of the FRCP, with prejudice and without costs to either side. The plaintiff's complaint previously dismissed by the Court's Order of 8/21/01 will not be amended. Defendants will not seek Rule 11 sanctions or reimbursement for expenses incurred in connection with this action. The case is closed.

On August 21, 2001, Judge Milton Pollack issued a Memorandum dismissing the complaint without prejudice. Plaintiffs had 30 days to refine their pleadings to proper allegations and proportions and to file an amended complaint in conformity with the Rules.

The complaint alleges that defendants violated the federal securities laws by issuing materially false and misleading statements designed to, and successfull encouraging, individual investors, including members of the Class, to purchase securities of AOL based not on objective analyses, but rather on defendants' desire to attract and retain AOL's investment banking business. Furthermore, defendant Meeker's ratings, recommendations, and positive comments regarding AOL during the Class Period were also improperly influenced by her desire to increase her undisclosed personal compensation, which depended in large part upon the amount of investment banking business she generated for defendants. Specifically, Meeker's conflicts of interest remained undisclosed as she issued "inflated" ratings and recommendations for AOL. Meeker knew that the financial condition and future business prospects of AOL did not support her positive comments and recommendations, but she nevertheless issued positive reports encouraging investors, including members of the Class, to purchase shares of AOL even in the face of legitimate contrary research entering the marketplace. Meeker knowingly issued inflated ratings for the purpose of improperly benefitting herself and Morgan Stanley.