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Case Status:    SETTLED
On or around 03/03/2006 (Date of order of final judgment)

Filing Date: March 06, 2003

According to the Final Judgment and Order of Dismissal with Prejudice, entered on March 3, 2006, from U.S. District Judge Honorable Charles R. Breyer of the U.S. District Court of the Northern District of California, the settlement is approved.

By the Notice of Pendency and Proposed Settlement of Class Action dated November 30, 2005, the settlement fund is in the amount of $15,000,000 in cash.

As summarized by the Company’s Form 10-Q for the quarterly period ended November 25, 2005, additional complaints making similar allegations were subsequently filed in the same court, and pursuant to an order entered June 2, 2003, the Court appointed lead counsel and plaintiffs to represent the putative class in a single consolidated action. The Consolidated Amended Complaint, filed September 8, 2003, alleges an expanded class period of June 18, 2001 through September 26, 2002, and purports to add a claim for violation of Section 11 of the Securities Act of 1933, as amended (the “Securities Act”), on behalf of a putative class of former shareholders of C-MAC Industries, Inc., who acquired Solectron stock pursuant to the October 19, 2001 Registration Statement filed in connection with Solectron’s acquisition of C-MAC Industries, Inc. In addition, while the initial complaints focused on alleged inventory issues at the former Technology Solutions business unit, the Consolidated Amended Complaint adds allegations of inadequate disclosure and failure to properly account for excess and obsolete inventory at Solectron’s other business units. The complaint seeks an unspecified amount of damages on behalf of the putative class. On February 13, 2004 the Court denied defendants’ motion to dismiss the Complaint and on September 2, 2004 the Court signed an order provisionally certifying the Class. In August 2005, the parties reached an agreement in principal to settle the litigation on terms not material to Solectron, and the Court granted preliminary approval of the settlement on November 30, 2005. A settlement hearing is scheduled for March 1, 2006 to determine final approval of the settlement.

The original Complaint alleges 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 material misrepresentations to the market between September 17, 2001 and September 26, 2002, thereby
artificially inflating the price of Solectron securities. Throughout the
Class Period, as alleged in the Complaint, defendants issued numerous
statements reporting artificially inflated financial results. 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 carrying
tens of millions of dollars of obsolete and unsaleable inventory in its
Technology Solutions division which was required to be written down. As
a result of the foregoing, Solectron's reported financial results were
artificially inflated at all times during the Class Period; (b) as a
result of the Company's failure to writedown its inventory in a timely
manner, the financial statements published by the Company during the
Class Period were not prepared in accordance with Generally Accepted
Accounting Principles and were materially false and misleading; and (c)
that it was materially false and misleading to characterize the
Company's earnings during the Class Period, as "in line" with Company
guidance, when had the Company properly accounted for its inventory it
would have drastically missed its guidance.
On September 26, 2002, after the market closed, Solectron issued a press
release announcing its financial results for the fourth quarter of 2002
and fiscal year 2002. The Company also reported that it was booking a
pre-tax charge of $97 million to reserve for inventory revaluation and
write-off. Solectron attributed the bulk of the charge to "inventory
risk assumed by Solectron's product-oriented Technology Solutions
business unit ...." Following this announcement, and other revelations,
shares of Solectron common stock fell from their previous close.


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


Ticker Symbol: SLR
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: N.D. California
DOCKET #: 03-CV-00986
JUDGE: Hon. Charles R. Breyer
DATE FILED: 03/06/2003
CLASS PERIOD END: 09/26/2002
  1. Abbey Gardy, LLP (New York)
  2. Bernstein Liebhard & Lifshitz, LLP (New York)
  3. Cauley Geller Bowman Coates & Rudman, LLP (New York)
  4. Green & Jigarjian LLP
  5. Law Offices of Marc S. Henzel (Lawrence)
  6. Milberg Weiss Bershad Hynes & Lerach LLP (S.F., CA)
  7. Schiffrin & Barroway LLP
  8. Wolf Haldenstein Adler Freeman & Herz LLP (New York)
No Document Title Filing Date
COURT: N.D. California
DOCKET #: 03-CV-00986
JUDGE: Hon. Charles R. Breyer
DATE FILED: 09/08/2003
CLASS PERIOD END: 09/26/2002
  1. Cauley Geller Bowman Coates & Rudman, LLP (New York)
  2. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC)
  3. Green & Jigarjian LLP
  4. Green Welling LLP (San Francisco)
  5. Lerach Coughlin Stoia Geller Rudman & Robbins LLP (Melville)
  6. Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego)
  7. Milberg Weiss Bershad Hynes & Lerach LLP (S.F., CA)
  8. Schatz & Nobel, P.C.
  9. Schiffrin & Barroway LLP
  10. Schiffrin Barroway Topaz & Kessler, LLP (Walnut Creek)
No Document Title Filing Date
No Document Title Filing Date