Case Page

 

Case Status:    SETTLED
On or around 02/12/2007 (Date of order of final judgment)

Filing Date: January 29, 2002

According to a press release dated July 11, 2007, a class-action shareholder lawsuit against the former directors and officers of Williams Communications Group ended Friday with a federal judge granting summary judgment for the defendants. Williams Communications stock purchasers filed suit in 2002. The plaintiffs contended that company officials did not properly disclose the failing company's true financial condition, and that officials' public statements belied the firm's plummeting fiscal picture. According to the court's 169-page opinion, the defendants argued that the shareholders were not entitled to insurance against "improvident investment choices.” … The litigation was initially filed against the communications company, Williams Companies and auditors Ernst and Young. A federal court later separated it into two cases. The Williams Companies settled the portion of the litigation against it last year, agreeing to pay $290 million, with another $21 million from Ernst and Young.

One of the subclasses (the WMB Subclass) consists of purchasers of securities issued by Williams Companies, Inc. The other subclass (the WCG Subclass) consists of purchasers of common stock and notes issued by Williams Communications Group, Inc. The claims of the WMB Subclass have been settled. Defendants’ April 1, 2006 motions for partial summary judgment regarding the WCG Subclass are still pending.

On February 12, 2007, the Court entered the Orders signed by U.S. District Judge Stephen P. Friot and approving the Plan of Allocation of Settlement Proceeds, Awarding Awarding Aggregate Attorneys' Fees and Reimbursement of Litigation Expenses. Further, the Court approved the settlement and entered Judgment. On February 26, 2007, a Notice of Appeal was filed regarding the Order awarding attorneys’ fees. On June 5, 2007, a Notice of Agreement Concerning Allocation of Attorneys' Fees and Litigation Expenses was filed. According the Notice, the Seymour Law Firm shall receive $22,500,000 in attorney fees and the remainder of the fees shall be allocated to Bernstein Litowitz Berger & Grossmann LLP and the Burrage Law Firm. The Seymour Law Firm shall receive $1,775,638 in reimbursement of expenses, and Bernstein Litowitz Berger & Grossmann LLP and the Burrage Law Firm shall receive $8,752,054. The class representatives shall receive a total of $36,432. On June 8, 2007, the appeal was dismissed from the U.S. Court of Appeals for the Tenth Circuit.

On October 5, 2006, the Court granted preliminary approval of the settlement obtained from Williams and its auditor, Ernst & Young, for $311 million. A settlement fairness hearing will be held on February 9, 2007, at 10:00 a.m., before the Honorable Stephen P. Friot, United States District Judge, at the United States District Court for the Northern District of Oklahoma, 333 W. Fourth St., Tulsa, OK 74103.

In a press release dated June 13, 2006, Williams Cos. Inc. (NYSE:WMB) will pay $290 million US to settle a class-action shareholder lawsuit, but company officials say the settlement won't slow its recovery from accounting and liability woes. Williams announced the settlement early Tuesday. The settlement covers investors who purchased Williams securities between July 24, 2000, and July 22, 2002. The lawsuit stemmed from accounting practices related to energy trading and potential liability associated with Williams Communications Group Inc., a former unit of Williams. Williams guaranteed more than $2 billion of that company's debt. Williams Communications later went bankrupt. The Ontario Teachers' Pension Plan was the court-appointed co-lead plaintiff, with the Arkansas Teacher Retirement System, in the class action on behalf of investors who bought Williams securities. Auditors will also kick in $21 million US, bringing the total settlement to $311 million US.

As summarized by the Notice of Proposed Settlement of Securities Class Action dated October 5, 2006, by Order dated April 15, 2002, several actions were consolidated for all purposes as In re Williams Securities Litigation. The operative complaint is the Consolidated Amended Complaint (the “Complaint”) filed on October 7, 2002. The Complaint alleges violations of Sections 11 and 12(a)(2) of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, among other claims The Complaint alleges that between July 24, 2000 and July 22, 2002, inclusive, members of the WMB Subclass purchased or otherwise acquired Williams common stock, August Notes, and FELINE PACS, at prices that were artificially inflated as a result of the Settling Defendants’ dissemination of materially false and misleading statements and were injured thereby. Upon the close of fact and expert discovery, Lead Counsel filed an affirmative motion for summary judgment and opposed several motions for summary judgment filed by Williams, the Individual Settling Defendants, and the Underwriter Defendants. Defendants’ motions for summary judgment were under advisement by the Court at the time of Settlement.

The original complaint was filed alleging defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by
issuing a series of material misrepresentations to the market between July 24, 2000 and January 29, 2002, thereby artificially inflating the price of WMB
common stock and WCG common stock. Specifically, the complaint alleges that WMB and WCG issued a series of statements concerning their businesses, financial results and operations which failed to disclose (i) that the spin-off of WCG from WMB was not in the best interests of both WMB and WCG shareholders as the primary motivation for the spin-off of WCG was to allow WMB to shore up its balance sheet so that it could then issue more stock and/or debt to acquire companies using its common stock as currency and protect its debt rating; (ii) that WCG was operating at levels well below company-sponsored expectations, such that revenue projections were overstated, and costs and expenses were understated, and also such that, in an effort to control costs, defendants would soon have to take actions which would have a further adverse impact on WCG's profitability; (iii) that approximately $2 billion of WCG debt that was guaranteed for payment by WMB around the time of the spin-off was improperly footnoted by WMB as a mere contingent obligation of WMB, which was materially false and misleading because the declining financial condition of WCG made it
increasingly certain that WMB would be forced to pay on such guaranties, for which it did not adequately reserve; (iv) that WCG's assets were permanently
impaired and had to be written-off and that WCG avoided taking such write-offs on its own books through the series of financial machinations described in the complaint; (v) that WMB was carrying on its financial statements receivables from WCG that were impaired, uncollectible and should have been written-off in whole or in substantial part. Rather than writing off these impaired assets, which amounted to tens of millions of dollars, WMB agreed to extend up to $100 million of WCG's receivables with an outstanding balance due on March 31, 2001, to March 15, 2002; and (vi) that the sale and leaseback of WCG's office properties in or about September of 2001 was a non-arm's-length transaction at an inflated value for the properties whose motive and intent was to funnel monies to WCG and avoid forcing WMB to perform its guaranties and thereby adversely affect its results and debt ratings.

COMPANY INFORMATION:

Sector: Utilities
Industry: Natural Gas Utilities
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: WMB
Company Market: New York SE
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: N.D. Oklahoma
DOCKET #: 02-CV-00072
JUDGE: Hon. Sven Erik Holmes
DATE FILED: 01/29/2002
CLASS PERIOD START: 07/24/2000
CLASS PERIOD END: 01/29/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Abbey Gardy, LLP (New York)
    212 East 39th Street, Abbey Gardy, LLP (New York), NY 10016
    212.889.3700 · info@abbeygardy.com
  2. Berger & Montague PC
    1622 Locust Street, Berger & Montague PC, PA 19103
    800.424.6690 215.875.4604 · investorprotect@bm.net
  3. Berman DeValerio Pease Tabacco Burt & Pucillo (MA)
    One Liberty Square, Berman DeValerio Pease Tabacco Burt & Pucillo (MA), MA 2109
    617.542.8300 617.230.0903 · info@bermanesq.com
  4. Cohen Milstein Hausfeld & Toll PLLC (Seattle WA)
    701 Fifth Avenue, Suite 6860, Cohen Milstein Hausfeld & Toll PLLC (Seattle WA), WA 98014
    206.521.0080 206.521.0166 · lawinfo@cmht.com
  5. Finkelstein, Thompson & Loughran
    1050 30th Street, NW, Finkelstein, Thompson & Loughran, DC 20007
    202.337.8000 202.337.8090 · contact@ftllaw.com
  6. Keller Rohrback LLP (Seattle)
    1201 Third Avenue, Suite 3200, Keller Rohrback LLP (Seattle), WA 98101-3052
    800.776.6044 206.623.3384 · investor@kellerrohrback.com
  7. Lockridge, Grindal, Nauen P.L.L.P.
    Suite 301, 660 Pennsylvania Avenue Southeast, Lockridge, Grindal, Nauen P.L.L.P., DC 20003-4335
    202.544.9840 202.544.9850 ·
  8. Mark McNair
    1919 Pennsylvania Avenue, NW, Suite 800, Mark McNair , DC 20006
    703.273.3070 · wmmcnair@justice4investors.com
  9. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
    One Pennsylvania Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY), NY 10119-1065
    212.594.5300 ·
  10. Much, Shelist, Freed, Denenberg, Ament & Eiger, P.C.
    200 N LaSalle St Ste 2100, Much, Shelist, Freed, Denenberg, Ament & Eiger, P.C., IL 60601
    312.346.3100 ·
  11. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
  12. Scott & Scott LLC (Connecticut)
    P.O. Box 192, 108 Norwich Avenue, Scott & Scott LLC (Connecticut), CT 06415
    860.537.5537 860.537.4432 · scottlaw@scott-scott.com
  13. Shapiro Haber & Urmy LLP (Boston)
    75 State Street, Shapiro Haber & Urmy LLP (Boston), MA 02109
    617.439.3939 617.439.0134 · info@shulaw.com
  14. Stull, Stull & Brody (New York)
    6 East 45th Street, Stull, Stull & Brody (New York), NY 10017
    310.209.2468 310.209.2087 · SSBNY@aol.com
  15. Wechsler Harwood LLP
    488 Madison Avenue 8th Floor, Wechsler Harwood LLP, NY 10022
    212.935.7400 · info@whhf.com
  16. Zwerling, Schachter, Zwerling & Koppell LLP
    767 Third Avenue , Zwerling, Schachter, Zwerling & Koppell LLP, NY 10017
    ·
No Document Title Filing Date
COURT: N.D. Oklahoma
DOCKET #: 02-CV-00072
JUDGE: Hon. Sven Erik Holmes
DATE FILED: 10/07/2002
CLASS PERIOD START: 07/24/2000
CLASS PERIOD END: 07/22/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Abbey Gardy, LLP (New York)
    212 East 39th Street, Abbey Gardy, LLP (New York), NY 10016
    212.889.3700 · info@abbeygardy.com
  2. Berger & Montague PC
    1622 Locust Street, Berger & Montague PC, PA 19103
    800.424.6690 215.875.4604 · investorprotect@bm.net
  3. Bernstein Litowitz Berger & Grossmann LLP (New York, NY)
    1285 Avenue of the Americas, 33rd Floor, Bernstein Litowitz Berger & Grossmann LLP (New York, NY), NY 10019
    212.554.1400 212.554.1444 · blbg@blbglaw.com
  4. Faruqi & Faruqi LLP (New York) (former)
    320 East 39th Street, Faruqi & Faruqi LLP (New York) (former), NY 10016
    212.983.9330 212.983.9331 · Nfaruqi@faruqilaw.com
  5. Federman & Sherwood (Oklahoma City)
    120 North Robinson, Suite 2720, Federman & Sherwood (Oklahoma City), OK 73102
    405-235-1560 · wfederman@aol.com
  6. Milberg Weiss Bershad & Schulman LLP (New York)
    One Pennsylvania Plaza, 49th Floor, Milberg Weiss Bershad & Schulman LLP (New York), NY 10119
    212.594.5300 212.868.1229 · info@milbergweiss.com
  7. Schoengold & Sporn PC (New York)
    19 Fulton Street, Schoengold & Sporn PC (New York), NY 10038
    212.964.0046 212.267.8130 · Shareholderrelations@spornlaw.com
  8. Scott & Scott LLC (Connecticut)
    P.O. Box 192, 108 Norwich Avenue, Scott & Scott LLC (Connecticut), CT 06415
    860.537.5537 860.537.4432 · scottlaw@scott-scott.com
  9. Weiss & Yourman (Los Angeles, CA)
    10940 Wilshire Blvd - 24th Floor, Weiss & Yourman (Los Angeles, CA), CA 90024
    310.208.2800 310.209.2348 · info@wyca.com
  10. Wolf Haldenstein Adler Freeman & Herz LLP (New York)
    270 Madison Avenue, Wolf Haldenstein Adler Freeman & Herz LLP (New York), NY 10016
    212.545.4600 212.686.0114 · newyork@whafh.com
  11. Yourman Alexander & Parekh LLP
    3601 Aviation Blvd., Suite 3000, Yourman Alexander & Parekh LLP, CA 90266
    310.725.6400 310.725.6420 ·
No Document Title Filing Date