According to a press release dated September 11, 2008, a settlement was reached in a consolidated class-action lawsuit over a secondary offering of AirGate PCS, Inc., in December 2001, which named Thomas Weisel Partners Group, Inc., as a defendant.
On September 29, 2006, a Notice of Settlement and Withdrawal of Pending Motions was filed. According to the Notice, the parties will now prepare a
stipulation of settlement and accompanying exhibits for submission to the Court.
According to Alamosa Holding, Inc.'s FORM 10-Q for the quarterly period ended September 30, 2005, on September 30, 2005, the Court issued an opinion and order (the "Order") ruling on these motions. As to the AirGate Defendants, the Court (a) dismissed plaintiffs' claims under Section 12(a)(2) of the Securities Act, and (b) also dismissed the remaining Section 11 and Section 15 claims as to five of the six alleged misstatements pled in the Consolidated Complaint, while declining to dismiss the claims related to allegation (v) above, concerning the iPCS network build-out. As to the Underwriter Defendants, the Court granted the motion to dismiss in its entirety. The Order permitted plaintiffs to file a further amended complaint, which plaintiffs did on October 19, 2005 (the "Second Amended Complaint").
As reported by the same SEC filing, after initially denying motions for appointment of lead plaintiffs and lead plaintiffs' counsel, the Court granted a modified renewed motion for appointment of lead plaintiffs and lead plaintiffs' counsel on August 17, 2004. Pursuant to a consent scheduling order, lead plaintiffs filed a consolidated amended class action complaint on October 15, 2004, naming the same defendants (the "Consolidated Complaint"). On December 30, 2004, the AirGate Defendants and the Underwriter Defendants filed motions to dismiss the Consolidated Complaint.
The original Complaint alleges that defendants violated Sections 11, 12(a)(2) and 15 of the Securities Act of 1933, by issuing a series of material misrepresentations to the market in the Company's December 14, 2001 Prospectus, thereby artificially inflating the price of Airgate securities. Specifically, the complaint alleges that the Prospectus used by defendants to sell $200 million worth of Airgate stock was false and misleading because, among other things, it failed to disclose: (a) that in order to complete an effective integration of iCPS, drastic changes would have to be made to AirGate's distribution channels and as a result, the integration of iCPS would take longer than expected and sales to new subscribers would be significantly reduced; (b) sales forces in the acquired iCPS markets would require extensive restructuring, which would negatively impact productivity, resulting in a lower than expected number of new subscribers in the iCPS markets; and (c) that the "churn," or "turnover" rate for customers would increase as a result of an increase in the amount of sub-prime credit quality customers the Company added from its merger with iCPS.
NOTE: In December 2004, Alamosa Holdings, Inc. purchased AirGate PCS, Inc.