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Case Status:    SETTLED
On or around 09/07/2007 (Date of order of final judgment)

Filing Date: May 17, 2002

On December 18, 2007, the Court entered the Order from the U.S. Court of Appeals for the Sixth Circuit granting the motion to dismiss the appeal.

According to the Company’s FORM 10-Q for the quarterly period ended September 30, 2007, on September 6, 2007, the court issued a final order approving the settlement. The remaining settlement amount was paid following the September 6, 2007 hearing. On October 5, 2007, two former officers of Consumers filed an appeal of the order approving the settlement of the shareholder litigation. Based on the objections they filed in the District Court and comments made on the record at the fairness hearing on September 6, 2007, they are not challenging the amount of the settlement. Their principal complaint was with the exclusion of all present and former officers and their immediate families from participation in the settlement. It is not anticipated that the appeal will result in changes to any material terms of the settlement approved by the District Court.

As summarized by the same SEC filing, Beginning in May 2002, a number of complaints were filed against CMS Energy, Consumers and certain officers and directors of CMS Energy and its affiliates in the United States District Court for the Eastern District of Michigan. The cases were consolidated into a single lawsuit (the “Shareholder Action”), which generally seeks unspecified damages based on allegations that the defendants violated United States securities laws and regulations by making allegedly false and misleading statements about CMS Energy’s business and financial condition, particularly with respect to revenues and expenses recorded in connection with round-trip trading by CMS MST. In January 2005, the court granted a motion to dismiss Consumers and three of the individual defendants, but denied the motions to dismiss CMS Energy and the 13 remaining individual defendants. In March 2006, the court conditionally certified a class consisting of “all persons who purchased CMS Common Stock during the period of October 25, 2000 through and including May 17, 2002 and who were damaged thereby.” The court excluded purchasers of CMS Energy’s 8.75 percent Adjustable Convertible Trust Securities (“ACTS”) from the class and, in response, a new class action lawsuit was filed on behalf of ACTS purchasers (the “ACTS Action”) against the same defendants named in the Shareholder Action. The settlement described in the following paragraph has resolved both the Shareholder and ACTS Actions. On January 3, 2007, CMS Energy and other parties entered into a Memorandum of Understanding (the “MOU”), subject to court approval, regarding settlement of the two class action lawsuits. The settlement was approved by a special committee of independent directors and by the full board of directors of CMS Energy. Both judged that it was in the best interests of shareholders to eliminate this business uncertainty. Under the terms of the MOU, the litigation was settled for a total of $200 million, including the cost of administering the settlement and any attorney fees the court awards. CMS Energy made a payment of approximately $123 million plus interest on the settlement amount on September 20, 2007. CMS Energy’s insurers paid $77 million, the balance of the settlement amount. In entering into the MOU, CMS Energy made no admission of liability under the Shareholder Action and the ACTS Action. The parties executed a Stipulation and Agreement of Settlement dated May 22, 2007 (“Stipulation”) incorporating the terms of the MOU. In accordance with the Stipulation, CMS Energy paid approximately $1 million of the settlement amount to fund administrative expenses.

The original complaint charges that 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 materially false and misleading statements to the market between August 3, 2000 and May 10, 2002. According to the complaint, CMS had, throughout the Class Period, improperly recognized approximately $4.4 billion in revenues by engaging in transactions lacking any economic substance using what are known as "round-trip" trading transactions. The improperly recognized revenues were, according to the complaint, reported in the Company's quarterly and annual press releases and in financial filings with the Securities and Exchange Commission ("SEC"), throughout the Class Period. On May 10, 2002, CMS announced that the SEC was investigating the propriety of its "round-trip" trading practices. In response to the announcement, CMS' common stock price collapsed, falling from a high of $20.06 on May 10, 2002 to a low of $15.72 on May 13, 2002--a drop of more than 21% on extremely heavy trading volume.


Sector: Utilities
Industry: Electric Utilities
Headquarters: United States


Ticker Symbol: CMS
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: E.D. Michigan
DOCKET #: 02-CV-72004
JUDGE: Hon. George Caram Steeh
DATE FILED: 05/17/2002
CLASS PERIOD END: 05/10/2002
  1. Berger & Montague PC
    1622 Locust Street, Berger & Montague PC, PA 19103
    800.424.6690 215.875.4604 ·
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    515 North Flagler Drive - Suite 1701, Berman DeValerio Pease Tabacco Burt & Pucillo (FL), FL 33401
    561.835.9400 ·
  3. Bernard M. Gross
    1500 Walnut Street, Suite 600, Bernard M. Gross, PA 19102
    215.561.3600 215.561.3000 ·
  4. Bernstein Liebhard & Lifshitz, LLP (New York)
    10 E. 40th Street, 22nd Floor, Bernstein Liebhard & Lifshitz, LLP (New York), NY 10016
    800.217.1522 ·
  5. Cauley Geller Bowman Coates & Rudman LLP (Little Rock, AR)
    P.O. Box 25438, Cauley Geller Bowman Coates & Rudman LLP (Little Rock, AR), AR 72221-5438
    501.312.8500 501.312.8505 ·
  6. Hoffman & Edelson
    45 West Court Street, Hoffman & Edelson, PA 18901-4223
    215.230.8043 ·
  7. Keller Rohrback LLP (Seattle)
    1201 Third Avenue, Suite 3200, Keller Rohrback LLP (Seattle), WA 98101-3052
    800.776.6044 206.623.3384 ·
  8. Kirby McInerney & Squire LLP
    830 Third Avenue 10th Floor, Kirby McInerney & Squire LLP, NY 10022
    212.317.2300 ·
  9. Law Offices of Charles J. Piven, P.A.
    World Trade Center-Baltimore,401 East Pratt Suite 2525, Law Offices of Charles J. Piven, P.A., MD 21202
    410.332.0030 ·
  10. 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 ·
  11. Pomerantz LLP (New York)
    600 Third Avenue, Pomerantz LLP (New York), NY 10016
    212.661.1100 212.661.8665 ·
  12. Rabin & Peckel LLP
    275 Madison Avenue, 34th Floor, Rabin & Peckel LLP, NY 10016
    212.682.1818 212.682.1892 ·
  13. Schoengold & Sporn PC (New York)
    233 Broadway 39Th Floor, Schoengold & Sporn PC (New York), NY 10279
    212.964.0046 ·
  14. Scott & Scott LLC (Connecticut)
    P.O. Box 192, 108 Norwich Avenue, Scott & Scott LLC (Connecticut), CT 06415
    860.537.5537 860.537.4432 ·
  15. Shalov Stone & Bonner LLP
    276 Fifth Avenue, Suite 704, Shalov Stone & Bonner LLP, NY 10001
    212.686.8004 212.686.8005 ·
  16. Weiss & Yourman (New York, NY)
    The French Building, 551 Fifth Ave., Suite 1600, Weiss & Yourman (New York, NY), NY 10126
    212.682.3025 212.682.3010 ·
  17. 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 ·
No Document Title Filing Date
COURT: E.D. Michigan
DOCKET #: 02-CV-72004
JUDGE: Hon. George Caram Steeh
DATE FILED: 03/16/2005
CLASS PERIOD END: 03/31/2003
  1. Elwood S. Simon & Associates, PC
    355 S. Woodward Avenue Suite 250, Elwood S. Simon & Associates, PC, MI 48009
    810/646.9730 ·
  2. Entwistle & Cappucci LLP
    299 Park Avenue, 14th Floor, Entwistle & Cappucci LLP, NY 10171
    212.894.7200 212.894.7272 ·
  3. Milberg Weiss & Bershad LLP (New York)
    One Pennsylvania Plaza, 49th Floor, Milberg Weiss & Bershad LLP (New York), NY 10119
    212.594.5300 212.868.1229 ·
  4. 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 ·
  5. Milberg Weiss LLP (New York)
    One Pennsylvania Plaza, 49th Floor, Milberg Weiss LLP (New York), NY 10119
    212.594.5300 212.868.1229 ·
  6. Miller Shea, P.C.
    1301 W Long Lake Rd, Ste 135, Miller Shea, P.C., MI 48098
    248.267.8200 248.267.8200 ·
No Document Title Filing Date