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Case Status:    DISMISSED    
On or around 03/14/2005 (Date of order of final judgment)

Filing Date: August 17, 2004

According to the Company’s FORM 10-K for the fiscal year ended December 31, 2004, on March 11, 2005, the court dismissed the Consolidated and Amended Complaint with prejudice. The court ruled that plaintiffs would not be permitted to amend further their complaint.

As disclosed by the same SEC filing the Company and four of its officers (the “Primus Defendants”) were defendants in a consolidated class action in the United States District Court for the Eastern District of Virginia, “In re Primus Telecommunications Group, Incorporated Securities Litigation.” Plaintiffs sued on behalf of certain purchasers (the “Class”) of Primus securities between February 14, 2003 and July 29, 2004 (the “Class Period”). In December 2004, the plaintiffs filed their Consolidated and Amended Complaint (“CAC”). Plaintiffs alleged that the Primus Defendants violated Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5. Plaintiffs sought damages, among other things, on the theory that the Primus Defendants fraudulently published false and misleading statements and/or fraudulently concealed adverse, non-public information about Primus, thereby artificially inflating the price of Primus’s securities. The CAC also covered matters related to: (i) PTI’s acquisition in 2002 of Cable & Wireless’s customers in the United States and migration and attrition of such customers; (ii) VOIP initiatives and challenges faced by Primus with respect to launching the various VOIP products; and (iii) Primus’s network and decisions to lease capacity versus purchase capacity. The Primus Defendants filed a motion to dismiss the Consolidated and Amended Complaint in January 2005.

Several purported shareholder class action lawsuits have been filed against Primus Telecommunications Group, Inc. and certain of its present and former executive officers. The first complaint filed alleges that defendants violated the Securities Exchange Act of 1934. More specifically, the complaint alleges that during the Class Period, PRIMUS's shares traded at inflated levels due to materially false and misleading statements issued by defendants to the investing public regarding the Company's business and prospects. The true facts, which were known by each of the defendants but concealed from the investing public during the Class Period, were as follows: (a) the Company was experiencing massive pricing pressures on its standalone international long distance business and the Company's minutes of use were not growing, but actually declining; (b) contrary to its projections, the Company, on a consolidated basis, would actually lose money for the second half of 2004 and even the Company's second quarter projections were grossly overstated; (c) the Company's business model was incredibly weak and, as a result, combined with the Company's second quarter 2004 revelations and the fact that the Company was already highly leveraged ($580 million), its ability to raise the necessary monies for capital expenditures to achieve even the newly projected results was severely hampered if not taken away altogether; (d) contrary to defendants' statements, the Company was drowning in competition; and (e) as a result, the value of the Company as an enterprise was actually less than the Company's debt. As a result of these false statements, PRIMUS's shares traded at inflated prices during the Class Period, increasing to as high as $13.15 on January 26, 2004, whereby the Company's top officers and directors completed a $240 million note offering.

The complaint further alleges that on July 29, 2004, after the market closed, PRIMUS issued a press release announcing its second quarter results, posting a loss of $14.9 million, or $0.17 per share, which reversed the year-ago profit of $18.7 million, or $0.21 per share. The numbers fell far short of Wall Street's expectations. Defendants had forecast earnings of $.10 per share on revenue of $348 million. The Company blamed the industry-wide price war for its troubles and said it would push to roll out more integrated services in an effort to defend its turf. PRIMUS shares dropped $1.70 to $1.52 per share -- a 50% drop in a single day.


Sector: Services
Industry: Communications Services
Headquarters: United States


Ticker Symbol: PRTL
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: E.D. Virginia
DOCKET #: 04-CV-970
JUDGE: Hon. Leonie M. Brinkema
DATE FILED: 08/17/2004
CLASS PERIOD END: 07/29/2004
  1. Brodsky & Smith, LLC (former Pennysylvania)
  2. Cohen, Gettings & Caulkins, P.C.
  3. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC)
  4. Law Offices of Charles J. Piven, P.A.
  5. Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego)
  6. Milberg Weiss Bershad & Schulman LLP (New York)
  7. Schatz & Nobel, P.C.
  8. Schiffrin & Barroway LLP
  9. Wechsler Harwood LLP
No Document Title Filing Date
COURT: E.D. Virginia
DOCKET #: 04-CV-970
JUDGE: Hon. Leonie M. Brinkema
DATE FILED: 12/17/2004
CLASS PERIOD END: 07/29/2004
  1. Cohen Gettings P.C.
  2. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC)
No Document Title Filing Date
—Related District Court Filings Data is not available