Case Page

 

Case Status:    SETTLED
On or around 07/22/2004 (Date of order of final judgment)

Filing Date: May 31, 2002

According to the Company's FORM 10-Q for the quarterly period ended June 27, 2004, the parties have agreed to a settlement in which Rayovac will pay plaintiff class $4 million in consideration for dismissal of all claims brought under this suit. The parties filed a Stipulation of Settlement with the Court to this effect in March, 2004 and the Court granted its preliminary approval of this Stipulation in April, 2004 and its final approval of the Stipulation in July, 2004. A majority of the $4 million settlement will be covered by the Company’s insurers.

In a press release dated March 26, 2004, pending final court approval, Rayovac has reached an agreement in principle to settle the shareholder class action lawsuits. Under the terms of the proposed settlement, and subject to approval by the court, the settlement amount of $4 million would be principally funded by the Company's insurance carriers. This settlement will not affect the Company's previously announced earnings guidance.

According to a Dow Jones News Service article dated January 2, 2004, a federal judge ruled that the plaintiffs were barred from adding non-fraud securities claims
against an additional defendant because that
the claims were time-barred and couldn't be saved by the legislative extension through Sarbanes. The plaintiffs plan to appeal the decision.

The original Complaint alleges that defendants violated Sections 11, 12(a)(2) and 15 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, by issuing a series of material misrepresentations to the market between April 26, 2001 and September 19, 2001, thereby artificially inflating the price of Rayovac securities. Throughout the Class Period, as alleged in the Complaint, defendants issued materially false and misleading statements, including a materially false and misleading Registration Statement and Prospectus (the "Prospectus") issued in connection with its Secondary Offering of shares to the public, regarding the demand for the Company's products and the Company's future prospects.
Specifically, the Complaint alleges that these statements were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (a) that the Company was experiencing declining demand for its products and in order to stimulate demand and create the impression that the Company was performing according to analyst expectations, Rayovac was extending generous credit terms to customers in order to induce them to purchase additional products, thereby pulling sales in from the future. As a result, Rayovac created the appearance of earnings growth, when defendants knew, or recklessly disregarded that future sales would be negatively impacted by the aforementioned practices; (b) that the Company's expansion in Latin America was the result of aggressive sales practices whereby the Company extended generous payment terms and induced customers to take additional unneeded inventory; and (c) based on the foregoing, defendants lacked a reasonable basis for their statements that the Company would grow by 8-9% in the third and fourth quarter of 2001. On September 20, 2001, before the market opened for trading, Rayovac issued a press release announcing that the Company's fiscal fourth quarter results would be negatively impacted by a purported slowdown in battery sales in its U.S. and Latin American markets. As a result, contrary to defendants' bullish Class Period statements, Rayovac's earnings for the quarter would be flat to down slightly from the same period for the previous year. The market's reaction to this announcement was immediate and punitive, with shares of Rayovac common stock falling more than 23% to a Class Period low of $12.74 per share on almost eight times the normal trading volume.

COMPANY INFORMATION:

Sector: Technology
Industry: Electronic Instruments & Controls
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: ROV
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: W.D. Wisconsin
DOCKET #: 02-CV-0308
JUDGE: Hon. Barbara B. Crabb
DATE FILED: 05/31/2002
CLASS PERIOD START: 04/26/2001
CLASS PERIOD END: 09/19/2001
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Abraham, Fruchter & Twersky (New York, 42 Street)
    60 East 42 Street, Abraham, Fruchter & Twersky (New York, 42 Street), NY 10021
    212.687.6655 ·
  2. Brian Felgoise
    230 South Broad Street, Suite 404 , Brian Felgoise, PA 19102
    215.735.6810 215/735.5185. ·
  3. 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 ·
  4. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
  5. 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
No Document Title Filing Date
COURT: W.D. Wisconsin
DOCKET #: 02-CV-0308
JUDGE: Hon. Barbara B. Crabb
DATE FILED: 06/18/2003
CLASS PERIOD START: 04/26/2001
CLASS PERIOD END: 09/19/2001
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Cauley Geller Bowman & Coates LLP
    11311 Arcade Drive - Suite 201, Cauley Geller Bowman & Coates LLP, AR 72212
    501.312.8500 ·
No Document Title Filing Date