On March 23, 2007, the Court issued the Orders approving the Plan of Allocation of Settlement Proceeds, awarding attorneys’ fees equal to eight percent of the Settlement Fund and granting Lead Counsel's application for reimbursement of expenses totaling $33,713.72 to be paid from the Settlement Fund. The Court entered the Final Judgment and Order of Dismissal signed by U.S. District Judge Gerard E. Lynch on March 28, 2007.
On January 10, 2005, the Court ordered that LACERA is appointed lead plaintiff and approved LACERA's choice of Kaplan Fox & Kilsheimer LLP as Lead Counsel. On March 15, 2005, the plaintiff filed an Amended Class Action Complaint. The defendants responded by filing a motion to dismiss the Amended Class Action Complaint on April 29, 2005. The motion to dismiss was withdrawn on March 6, 2006 due to a pending settlement. On November 14, 2006, the Court preliminarily approved the settlement which is in the amount of $13,000,000 in cash.
The original complaint alleges that Defendants violated the federal securities laws by issuing false and misleading analyst reports regarding Focal that recommended the purchase of Focal common stock and which set price targets for Focal common stock, without any reasonable factual basis. In issuing Focal reports, in which it recommended the purchase of Focal common stock, Defendants failed to disclose material, non-public, adverse information which contradicted their recommendation to purchase Focal stock. Throughout the Class Period, Defendants maintained a “Buy” recommendation on Focal in order to obtain and support lucrative financial deals for Salomon.
The Class Period begins on July 29, 1999, the date when Salomon “initiated coverage” of and issued their first report on Focal. The Class Period ends on August 13, 2001, the date Defendants belatedly downgraded Focal from a “Buy” to a “Neutral”. As a result of Defendants’ false and misleading analyst reports, Focal common stock traded at artificially inflated levels during the class period.