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Case Status:    SETTLED
On or around 08/24/2007 (Ongoing date of last review)

Filing Date: May 30, 2003

On June 18, 2007, a Settlement Agreement was filed among all parties. The settlement fund is in the amount of $3,000,000. On June 20, 2007, the Court entered the Order preliminary approving settlement and providing for notice. The settlement hearing is set for September 27, 2007.

On December 7, 2006, the Court granted the motion to certify the class and further granted the motion for entry of judgment in favor of defendant Deloitte & Touche LLP. On February 1, 2007, the remaining two individual defendants filed three motions for summary judgment. The motions for never ruled on as the parties participated in mediation which resulted in a settlement of the litigation.

On January 26, 2006, the Court entered the Order granting in part and denying in part the motion to dismiss. According to the Order, the Motion is granted with prejudice as to the claim of Artifically Inflated Accounts Receivable Balances contained in Countts I and III. The Motion is also granted with prejudice as to Count II. The Motion to Dismiss is denied as to the claim of Artificially Inflated Inventories at InterAct contained in Counts I and III. The case has been referred to mediation. On May 2, 2006, the plaintiff filed a motion to certify class.

On September 29, 2003, the Court entered the Order granting the motions for consolidation. On November 25, 2005, the Court entered the Order adopting and confirming the magistrate judge’s November 5, 2005 Report and Recommendation for the appointment of lead plaintiff and lead counsel. The Court appointed Glenn Costoff as lead plaintiff and the law firms of Shalov Stone & Bonner LLP of New York and Vianale & Vianale LLP of Boca Raton, Florida, as co-lead counsel. On April 5, 2004, a Consolidated Amended Class Action Complaint was filed, and on June 30, 2004, the defendants filed motions to dismiss the complaint. On February 23, 2005, the Court entered the Order signed by Judge John Antoon II granting the defendants' motions to dismiss without prejudice, allowing plaintiffs to file a second amended complaint. On April 1, 2005, the plaintiffs filed a Second Amended Consolidated Class Action Complaint. A motion to dismiss the complaint was filed on May 6, 2005. On May 26, 2005, the Court entered the Final Judgment of Dismissal with Prejudice in favor of two individual defendants.

The original Complaint charges that the Company violated federal securities laws by falsely assuring the marketplace that it had adopted a "strategic business plan designed to improve operating efficiencies," as required by the Company's creditors as a condition to restructuring the Company's debt. Beginning in November 1999, the Company repeatedly reaffirmed that it had implemented its "strategic plan" and emphasized its success at improving operating efficiencies. The Company also stressed that it had established "a more incentive-based method of compensation" and "stringent financial controls." On May 8, 2002, however, the Company partially disclosed that it "did not anticipate the full implementation of the strategic plan until the end of May 2002." On August 19, 2002, the end of the class period, the Company revealed information showing that, contrary to its earlier statements on awarding only incentive-based compensation to management, bonuses had been paid to executives in advance of the Company's achievement of certain goals. The Company also revealed that it had granted additional price concessions to customers "on products previously purchased." The complaint alleges that defendants materially overstated revenue during the class period and failed to timely take material write-downs of inventory.

NOTE: Recoton is not named a defendant in this action because it filed for bankruptcy protection on April 8, 2003.

COMPANY INFORMATION:

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

SECURITIES INFORMATION:

Ticker Symbol: RCOTQ
Company Market: NASDAQ
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: M.D. Florida
DOCKET #: 03-CV-0734
JUDGE: Hon. John Antoon II
DATE FILED: 05/30/2003
CLASS PERIOD START: 11/15/1999
CLASS PERIOD END: 08/19/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernstein Liebhard & Lifshitz, LLP (New York)
    10 E. 40th Street, 22nd Floor, Bernstein Liebhard & Lifshitz, LLP (New York), NY 10016
    800.217.1522 · info@bernlieb.com
  2. 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
  3. 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
  4. Stull, Stull & Brody (New York)
    6 East 45th Street, Stull, Stull & Brody (New York), NY 10017
    310.209.2468 310.209.2087 · SSBNY@aol.com
  5. Vianale & Vianale LLP (former Boca Raton)
    The Plaza - Suite 801, 5355 Town Center Road., Vianale & Vianale LLP (former Boca Raton), FL 33486
    561.391.4900 561.368.9274 · info@vianalelaw.com
  6. Zwerling, Schachter, Zwerling & Koppell LLP
    767 Third Avenue , Zwerling, Schachter, Zwerling & Koppell LLP, NY 10017
    ·
No Document Title Filing Date
COURT: M.D. Florida
DOCKET #: 03-CV-0734
JUDGE: Hon. John Antoon II
DATE FILED: 04/01/2005
CLASS PERIOD START: 11/15/1999
CLASS PERIOD END: 08/14/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Barker, Rodems & Cook, PA (former)
    300 W Platt St, Suite 150, Barker, Rodems & Cook, PA (former), FL 33606
    813.489.1001 813.489.1008 · info@barkerrodemsandcook.com
  2. Bernstein Liebhard & Lifshitz, LLP (New York)
    10 E. 40th Street, 22nd Floor, Bernstein Liebhard & Lifshitz, LLP (New York), NY 10016
    800.217.1522 · info@bernlieb.com
  3. Shalov Stone & Bonner LLP
    276 Fifth Avenue, Suite 704, Shalov Stone & Bonner LLP, NY 10001
    212.686.8004 212.686.8005 · lawyer@lawssb.com
  4. Shalov Stone Bonner & Rocco LLP (New York)
    485 Seventh Avenue, Suite 1000, Shalov Stone Bonner & Rocco LLP (New York), NY 10018
    212.239.4340 212.239.4310 · lawyer@lawssb.com
  5. Stull, Stull & Brody (New York)
    6 East 45th Street, Stull, Stull & Brody (New York), NY 10017
    310.209.2468 310.209.2087 · SSBNY@aol.com
  6. Vianale & Vianale LLP (former Boca Raton)
    The Plaza - Suite 801, 5355 Town Center Road., Vianale & Vianale LLP (former Boca Raton), FL 33486
    561.391.4900 561.368.9274 · info@vianalelaw.com
No Document Title Filing Date
No Document Title Filing Date