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Case Status:    SETTLED
On or around 07/18/2006 (Date of order of final judgment)

Filing Date: October 21, 2002

The Court approved the Settlement after a hearing held on July 14, 2006, and entered an Order and Final Judgment dated July 17, 2006.

According to a press release dated May 18, 2006, pursuant to Rule 23 of the Federal Rules of Civil Procedure and an Order of the Court, that the above-captioned action has been certified as a class action and that a settlement for $15,050,000 has been proposed. A hearing will be held before the Honorable Andre M. Davis in the United States District Court, Garmatz Federal Courthouse, Suite 4415, 101 West Lombard St., Baltimore, MD 21201, at 11:00 a.m., on July 14, 2006 to determine whether the proposed settlement should be approved by the Court as fair, reasonable, and adequate, and to consider the application of Plaintiffs' Counsel for attorneys' fees and reimbursement of expenses.

In a press release dated September 30, 2005, Allegheny Energy Inc. (AYE) has agreed to settle a consolidated securities class action lawsuit pending against the company and certain former officers, according to a regulatory filing Friday. Under the proposed settlement, the action will be dismissed with prejudice in exchange for $15.05 million in cash, which will be made by the utility holding company's insurance carrier. Allegheny also said it will settle related shareholder derivative actions for $450,000, also to be paid by insurance. In addition, the company agreed to adopt certain corporate governance changes.

Several, similar purported class action law suits were also filed in the U.S. District Court for the District of Maryland. On April 22, 2003, class action lawsuits that were filed in the U.S. District Court for the Southern District of New York were Ordered to be transferred to the District of Maryland, managed under Multi-District Litigation.

On March 16, 2001, Allegheny Energy's subsidiary Allegheny Energy Supply Company, LLC ("Allegheny Energy Supply") announced that it completed its acquisition of Global Energy Markets ("G.E.M.") from Merrill Lynch & Co., Inc. ("Merrill Lynch"). The complaint alleges that Allegheny Energy made false and misleading statements during the Class Period in that it omitted to state that its revenues (and revenue guidance) materially depended, on illusory, revenue
creating, "wash transactions" with Enron, and other deceptive energy trading
practices. At no point did Allegheny Energy disclose to the investing public
that: (i) the surge in its revenues was attributable to G.E.M.'s practice of
engaging in deceptive and illusory trades; and (ii) that after the Enron story
broke, Allegheny Energy could no longer engage in these deceptive trading
practices as successfully, and that revenues would drop as a result. On September 25, 2002, the Company sued Merrill Lynch for fraud and breach of
contract related to the G.E.M. acquisition. In that lawsuit, Allegheny Energy
alleged that it overpaid for G.E.M. because the unit's financial reports had
been inflated by sham trades involving Enron. The Company admitted that G.E.M engaged in a significant amount of wash or round trip energy trades with Enron, and perhaps others. The Company further admitted that the effect of those trades was to artificially inflate revenues, trading volumes and growth rate. The Company's September 25, 2002 admissions set a chain of events in motion, which would result in the Company's stock's tumble from a high of $12.85 on September 25, 2002 to $3.80 on October 8, 2002 -- a drop of $9.05, or 70%. On October 1, 2002, Moody's downgraded Allegheny Energy's credit to junk status. The Company, in a press release, reassured investors that this would not trigger any default or prepayment of the firm's debt. A week later, on October 8, 2002, the Company announced that it was in technical default under its credit agreements.

COMPANY INFORMATION:

Sector: Utilities
Industry: Electric Utilities
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: AYE
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: D. Maryland
DOCKET #: 02-CV-08366
JUDGE: Hon. Kevin T. Duffy
DATE FILED: 10/21/2002
CLASS PERIOD START: 04/23/2001
CLASS PERIOD END: 10/08/2002
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. Bernard M. Gross
    1500 Walnut Street, Suite 600, Bernard M. Gross, PA 19102
    215.561.3600 215.561.3000 · bmgross@BernardMGross.com
  3. Brodsky & Smith, LLC (former Pennysylvania)
    11 Bala Avenue, Suite 39, Brodsky & Smith, LLC (former Pennysylvania), PA 19004
    610.668.7987 610.660.0450 · esmith@Brodsky-Smith.com
  4. 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 · pivenlaw@erols.com
  5. 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 ·
  6. 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: D. Maryland
DOCKET #:
JUDGE: Hon. Kevin T. Duffy
DATE FILED: 05/03/2004
CLASS PERIOD START: 04/23/2001
CLASS PERIOD END: 10/08/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernard M. Gross
    1500 Walnut Street, Suite 600, Bernard M. Gross, PA 19102
    215.561.3600 215.561.3000 · bmgross@BernardMGross.com
  2. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC)
    1100 New York Avenue, N.W., Suite 500, West Tower, Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC), DC 20005
    202.408.4600 202.408.4699 · lawinfo@cmht.com
  3. 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
No Document Title Filing Date
No Document Title Filing Date