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Case Status:    SETTLED
On or around 09/21/2005 (Date of order of final judgment)

Filing Date: May 19, 2004

On September 20, 2005, the Court entered the Orders signed by U.S. District Judge Laura Taylor Swain granting the motions for approval of the settlement, the plan of allocation, and the application of lead plaintiff's counsel for an award of attorneys' fees in the amount of 30% of the settlement fund plus expenses in the amount of $18,695.79. That day, the Court entered the Final Judgment and Order of Dismissal with Prejudice.

According to the Notice of Pendency and Proposed Settlement of Class Action dated June 1, 2005, the proposed settlement creates a fund in the amount of $1,500,000.00 in cash. A settlement hearing will be held on September 16, 2005, at 11:00 a.m., before the Honorable Laura Taylor Swain, United States District Judge, Southern District of New York, at the United States Courthouse, 40 Centre Street, New York, New York (the “Settlement Hearing”). The purpose of the Settlement Hearing will be to determine: (1) whether the Class should be certified pursuant to Rule 23 of the Federal Rules of Civil Procedure, consisting of purchasers and acquirers of Descartes securities between June 4, 2003 and May 6, 2004, inclusive, excluding the Defendants, members of the immediate family of any Individual Defendant (parents, spouses, siblings and children), any subsidiary or affiliate of Descartes, and the directors and executive officers of Descartes or its subsidiaries or affiliates, or any entity in which any excluded person has a controlling interest, and the legal representatives, heirs, successors and assigns of any excluded person; (2) whether the settlement consisting of $1.5 million in cash should be approved as fair, reasonable and adequate to the Settling Parties; (3) whether the proposed plan to distribute the settlement proceeds (the “Plan of Allocation”) is fair, reasonable, and adequate; (4) whether the application by Plaintiff’s Counsel for an award of attorneys’ fees and expenses should be approved; and (5) whether the Litigation should be dismissed with prejudice.

The original complaint charges that Descartes and certain of its officers 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 June 4, 2003 and May 6, 2004, about its financial condition, thereby artificially inflating the price of Descartes' stock. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company had materially inflated its financial results; (2) that the Company maintained insufficient reserves for doubtful accounts, in light of the fact that the Company knew and/or recklessly disregarded the fact that it was having extreme difficulties in collecting receivables especially in the Asia-Pacific Region; (3) that the Company had overstated its revenues by at least $1.1 million by recognizing revenues from a significant contract with a customer in China that was impaired by regulatory action of the Chinese Government, a fact the Company knew and/or recklessly disregarded; (4) that the Company had failed to take sufficient write downs of assets that it had determined to be impaired; (5) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (6) that as a result, the value of the Company's net income and financial results were materially overstated at all relevant times. On May 6, 2004, after the markets had closed, Descartes announced that its revenues and loss per share for the three months ended April 30, 2004 will be materially below the expectations set forth in its March 10, 2004 press release. News of this shocked the market. Shares of Descartes fell $0.76 per share, or 38.97 percent, to close at $1.19 per share on May 7, 2004.


Sector: Technology
Industry: Software & Programming
Headquarters: Canada


Ticker Symbol: DSGX
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: S.D. New York
DOCKET #: 04-CV-3793
JUDGE: Hon. Laura Taylor Swain
DATE FILED: 05/19/2004
CLASS PERIOD END: 05/06/2004
  1. Brian Felgoise
    230 South Broad Street, Suite 404 , Brian Felgoise, PA 19102
    215.735.6810 215/735.5185. ·
  2. Cauley Geller Bowman Coates & Rudman, LLP (New York)
    200 Broadhollow, Suite 406, Cauley Geller Bowman Coates & Rudman, LLP (New York), NY 11747
    631.367.7100 631.367.1173 ·
  3. Geller Rudman, PLLC.
    197 South Federal Highway, Suite 200, Geller Rudman, PLLC., FL 33432
    561.750.3000 888.262.3131 ·
  4. 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 ·
  5. Law Offices of Marc S. Henzel (Lawrence)
    335 Central Avenue, Law Offices of Marc S. Henzel (Lawrence), NY 11559
    516.374.0707 516.295.3473 ·
  6. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 ·
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