Sipex Corporation is a semiconductor manufacturer of analog integrated circuits, regulators, and interface and optical storage products.

The original Complaint charges Sipex and certain key officers and director with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. 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 inappropriately recognized revenue on sales for which price protection, stock rotation and/or return rights were granted; (2) that the Company's financial results were in violation of Generally Accepted Accounting Principles ("GAAP"); (3) that the Company lacked adequate internal controls; and (4) that as a result of the above, the Company's financial results were materially inflated at all relevant times.

The Complaint further alleges that on or around January 20, 2005, Sipex announced that the Company may restate its financial statements for the fiscal year ended December 31, 2003 and the fiscal quarters ended April 3, 2004, July 3, 2004 and October 2, 2004 due to the possible improper recognition of revenue during these periods on sales for which price protection, stock rotation and/or return rights may have been granted. The news shocked the market. As a result, shares of Sipex fell $0.90 per share, or 23.44 percent, on January 21, 2005 to close at $2.94 per share, on unusually high volume.

Pursuant to the parties’ voluntary dismissals, Barbara Keller v. Sipex Corp. (Case No. 05-CV-00331) and Steve Levy v. Sipex Corp. (Case No. 05-CV-00505) are dismissed. By the Order dated May 12, 2005, the Court consolidated the remaining actions into a Master File known as In re Sipex Corporation Securities Litigation, Case No. 05-CV-00392.

By the Order dated November 17, 2005, U.S. District Judge William Alsup denied the Defendants' motions to dismiss, but granted one of the individual Defendant’s motion to dismiss with leave to amend.

In a press release dated January 18, 2006, Sipex announced that the United States District Court for the Northern District of California, San Francisco, preliminarily approved the settlement of a shareholder class action lawsuit (entitled In re Sipex Corporation Securities Litigation, Master File No. 05-CV-00392) pending against Sipex and a former director/officer. The $6 million settlement will be entirely funded by directors' and officers' insurance policy proceeds. Terms for distribution of the settlement fund to class members will be disclosed in a notice to be sent to class members. A final hearing will be held after delivery of notice to the class members. At that time, the court will determine whether to grant final approval of the settlement.

According to a press release dated April 6, 2006, Sipex announced that the United States District Court for the Northern District of California, San Francisco, approved the settlement of a shareholder class action lawsuit (entitled In re Sipex Corporation Securities Litigation, Master File No. 05-CV-00392) pending against Sipex and a former director/officer. The $6 million settlement will be entirely funded by directors' and officers' insurance policy proceeds.