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Case Status:    SETTLED
On or around 09/29/2006 (Date of order of final judgment)

Filing Date: August 11, 2004

On September 29, 2006, the Court entered the Order and Final Judgment. The action was certified as a class action, and the settlement was approved as fair, reasonable and adequate. Plaintiffs' Counsel was awarded 25% of the Gross Settlement Fund in fees and $353,064.87 in reimbursement of expenses.

As disclosed by the Company’s FORM 10-Q for the quarterly period ended June 30, 2006, between August and September 2004, approximately five complaints were filed individually and on behalf of all others similarly situated in the United States District Court for the District of Arizona against the Company and two of its officers alleging violations of the federal securities laws arising out of declines in the Company’s stock price in 2004. The five lawsuits were consolidated in April 2005. On June 16, 2006, the Company entered into a settlement agreement with the plaintiffs, agreeing to pay $4,600,000 to settle this case, all of which is being paid for by insurance. The settlement was preliminarily approved by the Court on July 6, 2006 and is set for a final determination on September 29, 2006. Should the Court grant final approval of the settlement, the case will be dismissed with prejudice.

By Order dated August 19, 2005, the Court granted Ernst & Young’s motion to
dismiss plaintiffs’ claims against Ernst & Young, but denied the Defendants’ motion to dismiss the Complaint as against the Defendants.

The original complaint alleges that throughout the Class Period, Vistacare reported record revenue and overall growth and profitability in publicly disseminated press releases and SEC filings, and forecasted positive earnings and revenue targets. The complaint further alleges that, defendants managed to report quarter after quarter of record financial growth because, unbeknownst to investors, Defendants failed to properly reserve its Medicare reimbursements. The truth began to emerge on August 5, 2004. On that date, after the close of trading, the Company issued a press release announcing second quarter financial results for the quarter ending June 30, 2004. The press release stated that results for the quarter were impacted by the Company's decision to accrue $6.2 million in the quarter for its Medicare cap reserve (Cap). This news caused a dramatic decline in Vistacare's share price from a closing price of $18.72 on August 5, 2004 to $15.28 on August 6, 2004, for a total one day decline of over 18%.

COMPANY INFORMATION:

Sector: Healthcare
Industry: Healthcare Facilities
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: VSTA
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: D. Arizona
DOCKET #: 04-CV-1661
JUDGE: Hon. Earl H. Carroll
DATE FILED: 08/11/2004
CLASS PERIOD START: 11/06/2003
CLASS PERIOD END: 08/05/2004
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bonnett, Fairbourn, Friedman & Balint, PC (Phoenix)
    4041 N. Cental Avenue, Suite 1100, Bonnett, Fairbourn, Friedman & Balint, PC (Phoenix), AZ 85012-3311
    602.274.1100 ·
  2. Bull & Lifshitz
    18 East 41st St., Bull & Lifshitz, NY 10017
    212.213.6222 212.213.9405 ·
  3. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC)
    1100 New York Avenue, N.W., Suite 500, West Tower, Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC), DC 20005
    202.408.4600 202.408.4699 · lawinfo@cmht.com
  4. Kirby McInerney & Squire LLP
    830 Third Avenue 10th Floor, Kirby McInerney & Squire LLP, NY 10022
    212.317.2300 ·
  5. 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
  6. Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego)
    401 B Street, Suite 1700, Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego), CA 92101
    206.749.5544 206.749.9978 · info@lerachlaw.com
  7. Milberg Weiss Bershad & Schulman LLP (Boca Raton)
    5355 Town Center Road, Suite 900, Milberg Weiss Bershad & Schulman LLP (Boca Raton), FL 33486
    561.361.5000 561.367.8400 · info@milbergweiss.com
  8. Milberg Weiss Bershad & Schulman LLP (New York)
    One Pennsylvania Plaza, 49th Floor, Milberg Weiss Bershad & Schulman LLP (New York), NY 10119
    212.594.5300 212.868.1229 · info@milbergweiss.com
  9. Schatz & Nobel, P.C.
    330 Main Street, Schatz & Nobel, P.C., CT 06106
    800.797.5499 860.493.6290 · sn06106@AOL.com
  10. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
No Document Title Filing Date
COURT: D. Arizona
DOCKET #: 04-CV-1661
JUDGE: Hon. Earl H. Carroll
DATE FILED: 04/15/2005
CLASS PERIOD START: 11/06/2003
CLASS PERIOD END: 08/05/2004
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bonnett, Fairbourn, Friedman & Balint, PC (Phoenix)
    4041 N. Cental Avenue, Suite 1100, Bonnett, Fairbourn, Friedman & Balint, PC (Phoenix), AZ 85012-3311
    602.274.1100 ·
  2. Milberg Weiss Bershad & Schulman LLP (New York)
    One Pennsylvania Plaza, 49th Floor, Milberg Weiss Bershad & Schulman LLP (New York), NY 10119
    212.594.5300 212.868.1229 · info@milbergweiss.com
No Document Title Filing Date