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Case Status:    SETTLED
On or around 01/26/2011 (Ongoing date of last review)

Filing Date: November 17, 2004

The original Complaint alleges that during the Class Period, UTStarcom violated federal securities laws by issuing materially false or misleading public statements. On August 10, 2004, UTStarcom disclosed that it had "filed a request with the Securities and Exchange Commission for a five-day extension with respect to the filing of its Quarterly Report on Form 10-Q for the period ended June 30, 2004. More specifically, the complaint alleges that defendants misrepresented material adverse facts during the Class Period, including, but not limited to: (a) significant problems with the Company's internal controls; (b) problems related to the Company's revenue recognition polices and procedures; and (c) supply chain problems that delayed recognition of certain revenues. On September 16, 2004, UTStarcom filed its second-quarter 2004 financial results with the Securities and Exchange Commission stating, among other things, that a Company-initiated review of a $290 million contract with Japan Telecom Co., Ltd. led management to conclude that certain significant control deficiencies exist related to the review and evaluation of criteria related to revenue recognition. Four days later, on September 20, 2004, UTStarcom announced that the Company was revising its financial guidance downward for third-quarter and full-year 2004 and, moreover, would defer recognition of the entire $290-million Japan Telecom contract, rather than recognize revenue of $220 million in the second half of 2004. On this news UTStarcom stock fell from a close of $17.95 per share on August 10, 2004, to close at $15.37 per share on August 11, 2004.

NOTE: The class consists of all persons who purchased the securities of UTStarcom, Inc. between April 16, 2003 and August 11, 2004, including all purchasers in the January 8, 2004 stock offering and the September 16, 2003 debt offering.

As summarized by the Company’s FORM 10-Q for the quarterly period ended March 31, 2009, beginning in October 2004, several shareholder class action lawsuits alleging federal securities violations were filed against the Company and various officers and directors of the Company. The actions have been consolidated in United States District Court for the Northern District of California under the caption In re UTStarcom, Inc. Securities Litigation, Master File No. C-04-4908-JW (PVT). The lead plaintiffs in the case filed a First Amended Consolidated Complaint on July 26, 2005. The First Amended Complaint alleged violations of the Securities Exchange Act of 1934, and was brought on behalf of a putative class of shareholders who purchased the Company’s stock after April 16, 2003 and before September 20, 2004. On April 13, 2006, the lead plaintiffs filed a Second Amended Complaint adding new allegations and extending the end of the class period to October 6, 2005. In addition to the Company defendants, the plaintiffs are also suing Softbank. Plaintiffs’ complaint seeks recovery of damages in an unspecified amount.

On June 2, 2006, the Company and the individual defendants filed a motion to dismiss the Second Amended Complaint. On March 21, 2007, the Court granted defendants’ motion and dismissed plaintiffs’ Second Amended Complaint. The Court granted plaintiffs leave to file a Third Amended Complaint, which plaintiffs filed on May 25, 2007. On July 13, 2007, the Company and the individual defendants filed a motion to dismiss and a motion to strike the Third Amended Complaint. On March 14, 2008, the Court granted defendants’ motion and dismissed plaintiffs’ Third Amended Complaint. The Court granted plaintiffs leave to file a Fourth Amended Complaint, which plaintiffs filed on May 14, 2008. On June 13, 2008, consistent with the Court’s March 14, 2008 dismissal order, the Company and the individual defendants filed objections to the form and content of the Fourth Amended Complaint. On July 24, 2008, the Court overruled the objections. On September 8, 2008, the Company and the individual defendants filed a motion to dismiss and a motion to strike certain allegations from the Fourth Amended Complaint. On March 27, 2009, the Court denied defendants’ motion to dismiss and granted defendants’ motion to strike.

On February 26, 2010, the plaintiffs filed a motion to certify the class. On April 1, 2010, a Stipulation of Settlement and a Motion for Preliminary Approval of Partial Settlement were filed. According to the Stipulation, the settling defendants, UTStarcom and Individual Defendants or their counsel shall cause the UTStarcom Defendants’ Insurers to transfer the principal amount of $30,000,000 in cash. The non-settling parties are defendants SoftBank Corporation, SoftBank America, Inc., and SoftBank Holdings, Inc.

On May 12, 2010, Judge James Ware granted the plaintiffs’ motion for class certification as to defendant SoftBank. On May 13, 2010, Judge Ware preliminarily approved the settlement. On August 31, 2010, the Court approved the settlement, approved the plan of allocation, awarded lead counsel attorneys’ fees and expenses, and dismissed the action with prejudice.

On October 8, 2010, a Stipulation of Settlement was filed. The proposed settlement is in the amount of $2.9 million and will settle claims with Defendants SoftBank Corporation, SoftBank America, Inc., and SoftBank Holdings, Inc. The proposed settlement was approved in November 2010. The final settlement hearing was set for February 7, 2011. On that day, the Court approved the settlement, approved the plan of allocation, and awarded attorney fees in the amount of 24.5% of the settlement fund and expenses in the amount of $190,000. The Court entered a Revised Final Judgment and Order of Dismissal with Prejudice on February 17, 2011.

COMPANY INFORMATION:

Sector: Services
Industry: Communications Services
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: UTSI
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: N.D. California
DOCKET #: 04-CV-04908
JUDGE: Hon. James Ware
DATE FILED: 11/17/2004
CLASS PERIOD START: 04/16/2003
CLASS PERIOD END: 08/11/2004
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Lerach Coughlin Stoia Geller Rudman & Robbin (San Francisco)
    100 Pine Street, Suite 2600, Lerach Coughlin Stoia Geller Rudman & Robbin (San Francisco), CA 94111
    415.288.4545 415.288.4534 · info@lerachlaw.com
  2. 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
No Document Title Filing Date
COURT: N.D. California
DOCKET #: 04-CV-04908
JUDGE: Hon. James Ware
DATE FILED: 05/14/2008
CLASS PERIOD START: 02/21/2003
CLASS PERIOD END: 10/12/2007
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Coughlin Stoia Geller Rudman & Robbins LLP (San Francisco)
    100 Pine Street, Suite 2600, Coughlin Stoia Geller Rudman & Robbins LLP (San Francisco), CA 94111
    415.288.4545 415.288.4534 ·
No Document Title Filing Date
No Document Title Filing Date