According to the Company’s FORM 10-K for the fiscal year ended December 31, 2004, in February 2004, the parties agreed to settle the case in exchange for a payment on behalf of all defendants of $4.5 million, with all settlement amounts paid by the Company’s director and officer liability insurance carrier. In August 2004, the court entered a final judgment dismissing the action.

In a press release dated June 17, 2004, the proposed settlement of the class action in the United States District Court for the Northern District of Illinois, Eastern Division, will be the subject of a hearing which will be held before the Honorable David H. Coar, United States District Judge, on August 25, 2004.

The complaint was filed charing Apropos Technology, Inc. with making false statements about the composition of the company's management team in regulatory filings linked to its initial public offering. According to the complaint, the prospectus for the February 17, 2000 offering falsely stated that co-founders Patrick K. Brady and William W. Bach were active members of its executive management team when they had stopped playing important roles within the company months before the prospectus was issued. Named as defendants are the company, its top directors and the underwriters who helped take it public. The prospectus listed Brady as chief technology officer and Bach as vice president of technology. But Apropos President and CEO Kevin G. Kerns had effectively ousted Brady after a power struggle that culminated in July 1999. Though Brady maintained his title, he no longer had a company office or any employees who reported to him. Similarly, Kerns stripped Bach of his executive managerial responsibilities and involvement in shaping the company's core technology. Kerns, who became the de-facto CTO, attempted to hire a replacement for Brady before the prospectus was issued, but was unsuccessful. So, Brady and Bach were listed in the prospectus as technology officers. Apropos issued nearly 4 million shares of common stock at $22 per share to thousands of investors based on offering materials that falsely stated that the founders who designed its key technological product were managing the company. "As a technology company whose business plan and future success depended heavily on proprietary technology, investors considered it important that the Apropos founders -- the people who developed and patented that proprietary technology -- still believed in the company, its business and its technology," the complaint says. "Plaintiffs and the other class members have lost tens of millions of dollars as a result of these material misrepresentations and omissions in the prospectus."