On September 29, 2006, the Court entered the Final Judgment and Order of Dismissal, signed by U.S. District Judge Gerard E. Lynch, settling the action. On November 22, 2006, the plaintiffs filed a motion to set aside co-lead counsel's proposed allocation of attorneys' fees. On January 18, 2007, the Court entered the Order that the motion is deemed withdrawn.
According to a press release dated July 17, 2006, the Securities Arbitration Law Firm of Klayman & Toskes, P.A., representing numerous high net-worth investors throughout the nation, advises all Salomon Smith Barney ("Smith Barney") n/k/a Citigroup Global Markets, Inc. customers who are eligible to participate in the Settlement of the In Re Salomon Analyst Level 3 Litigation ("Class Action") (No. 02 Civ. 6919 (GEL)), that they have until August 31, 2006 to opt-out of the Class. As part of the settlement of the Class Action, Smith Barney has agreed to pay the Class $10.25 million. However, this amount represents only a fraction of Level 3's market capital losses which were in excess of $30 billion during the class period of January 4, 1999 through June 18, 2001.
As summarized by the docket, on January 28, 2003, the Court entered the Order signed by U.S. District Judge Barbara S. Jones consolidating the actions into In re Salomon Analyst Level 3 Litigation, 02-CV-6919 (BSJ). On October 15, 2003, the plaintiffs filed a Consolidated Class Action Complaint, and the defendants responded by filing a motion to dismiss the claims in the complaint with prejudice. On December 2, 2004, the Court issued the Opinion and Order #90956 by U.S. District Judge Gerard E. Lynch granting in part and denying in part the motion to dismiss. The plaintiffs filed a motion for partial reconsideration of the December 2 Order, but on January 20, 2005, the Court issued the Memorandum and Opinion # 91136 denying the motion. On January 25, 2005, the plaintiffs filed a motion to dismiss pursuant to 15 U.S.C. sections 78u-4 et seq and Rule 12(b)(6) of the Federal Rules of Civil Procedure. On August 22, 2005, the Court issued the Order withdrawing the defendants' renewed motion to dismiss, without prejudice to its reinstatement if the settlement is for any reason not consummated. On May 18, 2006, the Court issued an Order preliminarily approving a settlement. Further, the Court will hold a settlement hearing on 09/29/06 at 10:30 a.m. in Courtroom 6B, United States Courthouse, 500 Pearl Street, NY, NY.
The original complaint alleges that Defendants urged investors to purchase Level 3 stock when they knew or should have known that such purchases were not a good investment. The complaint alleges that defendants issued "Buy" recommendations about Level 3 without any rational economic basis; failed to disclose that they were issuing "Buy" recommendations to obtain investment banking business; and concealed significant, material conflicts of interest that prevented them from providing independent objective analysis.