According to an article dated January 15, 2008, on December 4, 2007, the U.S. District Court for the Southern District of New York dismissed a securities fraud class action against a financial advisor, finding that the complaint failed to plead loss causation. … The district court dismissed the claims against Goldman.
On December 17, 2003, the Court entered the Order granting the motion to consolidate the cases, and on January 31, 2004, a Consolidated Amended Class Action Complaint was filed. On March 15, 2004, the defendants filed a motion to dismiss, and on April 20, 2006, the complaint was dismissed with leave to re-plead. On May 17, 2006, a Second Amended Consolidated Class Action Complaint was filed, and the defendants responded by filing a motion to dismiss the Second Amended Consolidated Class Action Complaint with prejudice.
The lawsuit charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by issuing false and misleading analyst reports on Exodus, a provider of internet system and network management solutions, in a bid to win or maintain lucrative banking and advisory work from the Company. As a result of defendants' false and misleading statements, the market price of Exodus common stock was artificially inflated, maintained or stabilized during the Class Period. On or about April 28, 2003, the United States Securities and Exchange Commission ("SEC") issued a complaint charging Lehman with violating numerous rules of conduct of the National Association of Securities Dealers, Inc. ("NASD") and the New York Stock Exchange, Inc. ("NYSE"),
by issuing false and misleading analyst reports on numerous companies, including RealNetworks. The complaint describes the influence and control exerted by Goldman Sachs' investment bankers on its supposedly independent research analysts, and details how positive ratings and research reports on Exodus issued by defendants to the public were contrary to defendants' more negative assessments of the Company's true value and prospects.