On April 25, 2008, the Court issued the Order granting the motion to dismiss, with leave to amend. According to the Order, if Amended Complaint is not filed, this dismissal becomes a dismissal with prejudice. The lead plaintiff did not file an amended complaint and the civil case is now terminated.
On June 29, 2007, the Court entered the Order consolidating related actions and granting the motion to appoint Southwest Carpenters Pension Trust as lead Plaintiff and for approval of lead plaintiff’s selection of lead and liaison counsel. On August 27, 2007, the lead plaintiff filed a Consolidated Amended Class Action Complaint. The defendants responded by filing a motion to dismiss the Consolidated Amended Class Action Complaint on October 11, 2007. On October 17, 2007, Judge Thomas W. Thrash Jr. granted the motion to replace lead counsel Coughlin Stoia Geller Rudman & Robbins LLP.
According to a press release dated April 10, 2007, the complaint alleges that during the Class Period, defendants Checkfree Corp. and certain of its officers and directors made false and misleading statements and omissions regarding the Company's business, accounting practices and financial results. As early as April of 2006, Defendants issued objectively unreasonable guidance regarding the purported sustainability of month-over-month growth in their electronic commerce business, which included the projection of "25% annual transaction growth for the foreseeable future." Upon these false and misleading representations, stock analysts raised Checkfree's target price, as well as FY 2006 and 2007 EPS estimates, while issuing favorable "Buy" and "Outperform" ratings.
The complaint further alleges that on August 1, 2006, Defendants shocked the market with their disclosure of laggard fourth-quarter revenues, including a 2% decline in the Company's Payment Services division. As a result of disclosure of the corrective disclosure of the laggard nature of the Company's consumer transactions growth, the price of Checkfree shares plummeted $5.93 or 15.9%, to close on August 2, 2006 at $37.20, on extremely heavy volume of over 17.2 million shares.
A similar class action filing was also filed in the US District Court for the District Of Colorado.