The original complaint charges Symbol and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Symbol engages in the design, development, manufacture, and service of products and systems used in enterprise mobility solutions.
Specifically, the complaint alleges that, throughout the Class Period, defendants issued numerous positive statements about the Company's performance and future prospects. As alleged in the Complaint, these statements were materially false and misleading because defendants failed to disclose and/or misrepresented the following adverse facts, which were known, or recklessly disregarded by them, at all relevant times: (a) that Symbol had inadequate and deficient internal and financial controls; (b) that Symbol's reported expenses were understated; (c) that Symbol had massive overcapacity, inefficient operations and obsolete assets; (d) that Symbol was experiencing declining demand for its products; and (e) as a result of the foregoing, defendants' statements concerning the Company's financial prospects were lacking in a reasonable basis at all relevant times.
As the market learned the true information about Symbol, the inflation caused by Defendants' misrepresentations was removed and the price of Symbol common stock fell by nearly 50% from its Class Period high.
According to the Company’s FORM 10-Q For The Quarterly Period Ended September 30, 2006, several purported class actions have been consolidated for all purposes and on April 24, 2006, the Court appointed the Iron Workers Local # 580 Pension Fund as lead plaintiff and approved their retention of lead counsel on behalf of the putative class. On August 30, 2006, the lead plaintiff filed its Consolidated Amended Class Action Complaint, which alleges that the defendants misrepresented that, in connection with settlements of earlier criminal and civil investigations, the Company had implemented processes to improve its internal controls when, in fact, its internal controls were insufficient. In addition, the lead plaintiff in the New Class Actions alleges that as a result of the insufficient internal controls, the Company violated the Securities Exchange Act of 1934 by issuing statements concerning our prospects, financial results and financial controls that were allegedly false and misleading. The plaintiffs allege that they were damaged by, among other things, the decline in the price of the Company’s stock on August 1, 2005, the date the Company released its results for the second quarter of 2005.
On February 26, 2007, the Defendants filed a motion to dismiss the the Lead Plaintiff's Consolidated Amended Class Action Complaint. On September 11, 2008, Senior Judge Denis R. Hurley administratively closed the case.