Micromuse, Inc. is a software developer.

The original Complaint alleges violation of sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The Complaint alleges that during the Class Period, Defendants knowingly or recklessly issued materially false and misleading financial statements that misrepresented the Company's earnings and shareholder equity. The Complaint also alleges that during this period, Company insiders sold Micromuse stock for proceeds of approximately $174 million.

Specifically, the Complaint alleges that on December 30, 2003 Micromuse announced the filing of its annual report on Form 10-K would be delayed pending completion of an internal inquiry, primarily regarding accounting for accrued expenses and expense recognition, and that the Company expected the inquiry to lead to a restatement of financial results for the fiscal years ending September 20, 2000, 2001, 2002 and 2003. In reaction to this announcement, the price of Micromuse common stock dropped by 12.4%, from a closing price of $6.90 on December 29, 2003, and closed the day down 4% at $6.59 on volume ten times greater than average.

As summarized by the Company’s FORM 10-K For the Fiscal Year Ended September 30, 2004, between January 12, 2004 and March 5, 2004, seven securities class action Complaints were filed in the United States District Court for the Northern District of California against the Company and certain of its current and former officers and directors. In July 2004, the District Court consolidated the various actions, named Massachusetts Laborer’s Pension Fund as lead Plaintiff and appointed the law firm of Berman, DeValerio, Pease, Tabacco, Burt & Pucillo as lead Plaintiff’s Counsel. In September 2004, lead Plaintiff filed a consolidated amended Complaint on behalf of a purported class of purchasers of the Company’s common stock. The alleged class period is January 18, 2001 through May 18, 2004. The consolidated amended Complaint seeks an unspecified amount of damages and asserts causes of action for alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5, arising out of the Company’s restatement of its previously issued financial statements for the fiscal years ended September 30, 2001 and 2002 and for the quarters ended December 31, 2000 through June 30, 2003, and the Company’s adjustment of its preliminary consolidated financial statement information for the quarter and fiscal year ended September 30, 2003, as initially announced on October 29, 2003, and the Company’s adjustment of preliminary financial information for the quarter ended December 31, 2003, as announced on February 10, 2004. On November 8, 2004, the Company and the other Defendants moved to dismiss the consolidated amended Complaint.

According to a press release dated June 27, 2005, Micromuse said that it has agreed to pay an undisclosed amount to settle a securities class action lawsuit against it and a number of current and former officers, as well as a related federal shareholder derivative lawsuit. The cases were related to its restated financial reports filed May 17. The Company said the payment will have no material adverse financial impact and will be covered largely by its insurers. Micromuse said none of the parties connected with the lawsuits admitted liability and that it didn't make any admission of wrongdoing. The settlement must receive court approvals, said Micromuse.

By the Final Judgment and Order of Dismissal signed by U.S. District Judge Bernard Zimmerman on December 8, 2005, the Court hereby grants final approval to the Stipulation of Settlement and finds that it is fair, reasonable, and adequate, and in the best interests of the Class as a whole. The Class Action is dismissed with prejudice.

On March 4, 2008, the Order Approving Final Accounting; Terminating Settlement Administration; and Discharging Lead Counsel, Lead Plaintiff and the Claims Administrator from Further Duties in Connection Therewith was signed.