Case Page

 

Case Status:    DISMISSED    
On or around 02/12/2007 (Other)

Filing Date: October 11, 2005

On February 12, 2007, U.S. District Judge Patti B. Saris issued the Memorandum and Order granting the several motions to dismiss the Amended Class Action Complaint. The civil case is terminated.

On December 18, 2006, the plaintiffs filed a Motion for Default Judgment as to defendants Jo Lernout, Pol Hauspie, and Carl Dammekens. In January 2007, Judge Patti B. Saris granted the motion for Default Judgment.

On January 4, 2006, the Court entered the Order signed by U.S. District Judge Patti B. Saris granting the motion for appointment of lead plaintiffs and approval of choice of lead counsel. On May 15, 2006, the plaintiffs filed an Amended Complaint, and the defendants have since then responded by filing motions to dismiss the Amended Complaint.

The lawsuit is pending in the United States District Court for the District of Massachusetts against various former officers and directors of the Company, the Company's auditors, and certain financial institutions (collectively, the "Defendants") for violations of the federal securities laws. It is the only United States class action filed on behalf of purchasers of L&H securities on the EASDAQ stock market. The complaint alleges that the Defendants engaged in a massive accounting fraud, at the direction of its Senior Officers, which resulted in the overstatement of L&H's publicly reported revenues from its first quarter of fiscal year 1998 through its first two quarters of fiscal year 2000, by a total of US$377 million (64% higher than its actual earnings). The complaint states that L&H engaged in numerous illegal accounting irregularities ranging from back-dating contracts to prematurely recording revenue, to swapping goods with customers and recording the swap as revenue, to recording revenue even when the sales contract was not yet negotiated or signed, to giving customers side-agreements and the right to return the product.

In addition, L&H, along with Dexia Bank Belgium (formerly known as Artesian Banking Corp. S.A.), set up 30 companies which allegedly licensed millions of dollars worth of software from L&H. L&H improperly recorded all the purported revenue it received from these companies, the purpose of which was to "pump up" L&H's publicly reported revenues and benefit L&H's major shareholders -- FLV, Mercator and the Company's officers. The complaint goes on to allege that L&H could not have perpetrated this massive accounting fraud without the collaboration of its auditors, including KPMG, and its banks, including Dexia.

The complaint further alleges that on or around August 8, 2000, The Wall Street Journal revealed the wide-spread fraud that had allegedly been concealed by L&H and KPMG and others. The August 8, 2000 article disclosed that the revenues, and the resulting net income and earnings per share that L&H had reported in the fourth quarter of 1999 and first quarter of 2000 were overstated. On this news, the Company's common stock declined dramatically by 19% from the previous day's close of US$37 per share to US$29-13/16 per share, trading as low as US$26-3/4 per share. Then, after months of denials, on November 9, 2000, L& H issued a press release announcing that as a result of past accounting "errors and irregularities" the Company would need to restate the most recent 2-1/2 years of financial statements. The Company also warned that its third quarter 2000 revenues would "be at least US$40 million below its previously published range of US$165 to US$185 million." The Company further announced that KPMG's mid-term audit would not be completed by November 14, 2000. In reaction to theses disclosures, on November 9, 2000, both NASDAQ and EASDAQ suspended trading of L&H securities. Prior to the suspension, the price of L&H securities on the NASDAQ market fell as low as US$6.22 and the price of the common stock on EASDAQ fell to as low as US$ 3.70.

COMPANY INFORMATION:

Sector: Technology
Industry: Software & Programming
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: LHSP
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. Massachusetts
DOCKET #: 05-CV-12058
JUDGE: Hon. Patti B. Saris
DATE FILED: 10/11/2005
CLASS PERIOD START: 04/28/1998
CLASS PERIOD END: 11/08/2000
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. 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
  2. Hagens Berman Sobol Shapiro LLP (Seattle)
    1301 Fifth Avenue, Suite 2900, Hagens Berman Sobol Shapiro LLP (Seattle), WA 98101
    206-623-7292 206-623-0594 · info@hagens-berman.com
  3. Spector, Roseman & Kodroff (Philadelphia)
    1818 Market Street; Suite 2500, Spector, Roseman & Kodroff (Philadelphia), PA 19103
    215.496.0300 215.496.6610 · classaction@srk-law.com
No Document Title Filing Date
COURT: D. Massachusetts
DOCKET #: 05-CV-12058
JUDGE: Hon. Patti B. Saris
DATE FILED: 05/15/2006
CLASS PERIOD START: 04/28/1998
CLASS PERIOD END: 11/08/2000
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. 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
  2. Hagens Berman Sobol Shapiro LLP (Seattle)
    1301 Fifth Avenue, Suite 2900, Hagens Berman Sobol Shapiro LLP (Seattle), WA 98101
    206-623-7292 206-623-0594 · info@hagens-berman.com
  3. Spector, Roseman & Kodroff (Philadelphia)
    1818 Market Street; Suite 2500, Spector, Roseman & Kodroff (Philadelphia), PA 19103
    215.496.0300 215.496.6610 · classaction@srk-law.com
No Document Title Filing Date