Read-Rite Corporation is a manufacturer of computer hardware, primarily magnetic recording heads for disk drives.

The original Complaint charges certain of Read-Rite's officers and directors with violations of the Securities Exchange Act of 1934. The Complaint alleges that during the Class Period, Defendants issued a series of false and misleading statements about the Company, and as a result Read-Rite's stock traded at inflated prices during the Class Period, increasing to as high as $39 on January 9, 2002, before the Company announced it would file for bankruptcy. The true facts which were known to each of the Defendants, but concealed from the investing public during the Class Period, were as follows: (a) The Company's 40 GB/platter inventory was overstated by $16.7 million; (b) The Company's Philippine real estate holdings were overstated by approximately $6.8 million; (c) The Company needed to restructure its operations and the associated charges would cost the Company in excess of $20 million and would cause an earnings shortfall in coming quarters; (d) The Company's Q2 FY03 loss was grossly understated; (e) The Company was experiencing massive technical problems associated with its 40GB/per platter programs. Moreover, the Company was experiencing these problems well before January 2002 and beyond April 2002 when Defendants claimed such problems were fixed; and (f) The Company was underfunded and could not complete the production of its 80GB programs.

Earlier, on September 22, 2004, the Court entered the Order granting the motion to dismiss the amended Complaint. On October 12, 2004, the Court entered the Letter from the lead Counsel to Judge Whyte regarding an agreement in principle to settle the matter.

According to the docket, on December 2, 2004, a Stipulation of Settlement was filed, and on May 6, 2005, the Court entered the Order and Final Judgment by U.S. District Judge Ronald M. Whyte. Further, the Court entered the Orders approving the plan of allocation and awarding the motion for attorney fees and reimbursement of expenses.