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Case Status:    SETTLED
On or around 07/11/2008 (Date of order of final judgment)

Filing Date: July 19, 2006

The original Complaint alleges that Defendants violated federal securities laws by issuing a series of materially false statements. Specifically, the representations in the Company's reported results of operations materially overstated Zale's net cash flows and free operating cash flows. In addition, the Company improperly accounted for extended service agreements, leases and accrued payroll.

The complaint further alleges that on or around April 10, 2006, before the open of regular trading, the truth began to emerge as Zale announced that the SEC had initiated a broad investigation into many aspects of the Company's accounting, operations and disclosure practices, including Zale's accounting for extended service agreements, leases and accrued payroll, executive compensation and severance, earnings guidance, stock trading and the timing of vendor payments. In reaction to this announcement, the price of Zale stock fell from $27.80 per share on April 7, 2006 to $25.16 per share on April 10, 2006. Then on Friday, May 5, 2006, after the market closed, Zale announced that it had replaced its Chief Financial Officer, Defendant Lenz, after discovering that the Company improperly inflated its reported net cash flows and free cash flows. On this news, the price of Zale stock dropped by $0.44 per share to close at $24.18 on May 8, 2006.

On October 17, 2006, the Court entered the Order signed by U.S. District Judge Harold Baer transferring the three similar securities class action from the U.S. District Court for the Southern District of New York to the Northern District of Texas.

On October 16, 2006, the Court appointed Pipefitters Local No. 636 Defined Benefit Plan, Iron Workers Local 16 Pension Fund and Mitchel Agoos as Lead Plaintiffs, and approved Lead Plaintiffs' selection of Co-Lead and Liaison Counsel. On January 29, 2007, Lead Plaintiffs filed a Consolidated Class Action Complaint for Violation of the Federal Securities Laws. On March 15, 2007, the Defendants filed a motion to dismiss the Complaint. On April 30, 2007, Lead Plaintiffs filed a memorandum in opposition to the motion to dismiss, and on May 21, 2007, Defendants filed a memorandum in reply.

On February 29, 2008, a Stipulation of Settlement was filed establishing a proposed settlement fund in the amount of $5,900,000 in cash. As a result of the proposed settlement, the Court denied the pending motion to dismiss. On March 19, 2008, District Court Judge David C. Godbey preliminarily approved the settlement. On July 10, 2008, the Court granted the motion for final approval of the settlement and plan of allocation and awarded attorney fees and expenses. The Court entered the Final Judgment and Order of Dismissal with Prejudice. The civil case is terminated.

COMPANY INFORMATION:

Sector: Services
Industry: Retail (Specialty)
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: ZLC
Company Market: New York SE
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. Texas
DOCKET #: 06-CV-05464
JUDGE: Hon. Harold Baer
DATE FILED: 07/19/2006
CLASS PERIOD START: 02/18/2005
CLASS PERIOD END: 05/05/2006
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Goldman Scarlato & Karon P.C.
    101 W. Elm Street, Suite 360, Goldman Scarlato & Karon P.C., PA 19428
    484.342.0700 484.342.0700 · info@gsk-law.com
  2. Labaton Sucharow & Rudoff LLP
    100 Park Avenue, 12th Floor, Labaton Sucharow & Rudoff LLP, NY 10017
    212.907.0700 212.818.0477 · info@labaton.com
  3. The Brualdi Law Firm (New York)
    29 Broadway - Suite 1515, The Brualdi Law Firm (New York), NY 10006
    877.495.1187 212.952.0608 ·
No Document Title Filing Date
COURT: N.D. Texas
DOCKET #: 06-CV-01470
JUDGE: Hon. Harold Baer
DATE FILED: 01/29/2007
CLASS PERIOD START: 02/18/2005
CLASS PERIOD END: 05/05/2006
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Labaton Sucharow & Rudoff LLP
    100 Park Avenue, 12th Floor, Labaton Sucharow & Rudoff LLP, NY 10017
    212.907.0700 212.818.0477 · info@labaton.com
  2. Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego)
    655 West Broadway, Suite 1900, Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego), CA 92101
    619.231.1058 619.231.7423 ·
  3. Schiffrin Barroway Topaz & Kessler, LLP (Radnor)
    280 King of Prussia Road, Schiffrin Barroway Topaz & Kessler, LLP (Radnor), PA 19087
    610.667.7706 610.667.7056 · info@sbtklaw.com
No Document Title Filing Date
No Document Title Filing Date