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Case Status:    SETTLED
On or around 04/19/2017 (Date of stipulation and/or agreement of settlement)

Filing Date: October 01, 2007

According to the docket, on August 15 the judge entered a minute order vacating his previous order to dismiss the case in light of an October 2007 order providing plaintiffs an opportunity to respond to the original motion to dismiss the non-consolidated action, which they never did. The case was ordered re-opened and continues as of August 18, 2008.

Of February 15, 2008 all related cases were consolidated and the judge appointed lead plaintiffs and approved selection of lead counsel. A First Consolidated Class Action Complaint was filed on May 2, 2008 and quickly met by defendants' motion to dismiss. The defendants successfully argued the motion and the judge ordered the case dismissed with prejudice on August 8, 2006.

According to a press release dated October 1, 2007, the complaint charges Harman and several of its officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”). It is alleged that defendants omitted or misrepresented material adverse facts about the Company’s financial condition, business prospects, and revenue expectations during the Class Period. Harman claims to be a leading manufacturer of high-quality, high fidelity audio products and electronic systems for the automotive, consumer and professional markets in the Americas, Europe, and Asia. The Company operates under the brands names Harman Kardon, JBL, Revel, Mark Levinson, Infinity, Lexicon, Soundcraft-Studer, AKG, Becker, and QNX, and is traded on the New York Stock Exchange.

The complaint alleges that on April 26, 2007, the Company announced that it had entered into a contract in which two investment funds affiliated or sponsored by private investment companies, Kohlberg Kravis Roberts & Co. L.P. (“KKR”) and GS Capital Partners VI Fund, L.P. (“GSCP”) (KKR and GSCP are collectively referred to as the “Purchasing Companies” herein), would merge with Harman (the “Merger”). According to the complaint, the Merger was valued at approximately eight billion dollars ($8,000,000,000).

Specifically, the complaint alleges that, during the Class Period, defendants issued numerous materially false and misleading statements which caused Harman’s securities to trade at artificially inflated prices. As alleged in the complaint, these statements were materially false and misleading because they misrepresented and failed to disclose that: (1) the Company had breached the Merger agreement with KKR and GSCP and thus placed the Merger in serious doubt; (2) the Company needed to sustain higher research and development (“R&D”) costs primarily related to its automotive platform awards; (3) the Company’s inventory was greater than disclosed and was negatively impacting its cash flows; (4) its relationship with Daimler-Chrysler had materially worsened; (5) a material adverse change in Harman's business had occurred which related to capital spending; (6) the Company’s financial health had generally deteriorated; and (7) as a result of the foregoing, the Company’s statements about its financial well-being, earnings, and future prospects were lacking in a reasonable basis when made.

According to the complaint, on September 21, 2007, the Company shocked the market and announced that the Purchasing Companies “no longer intend to complete the previously announced acquisition . . . KKR and GSCP have informed Harman that they believe that a material adverse change in Harman's business has occurred, that Harman has breached the merger agreement and that they are not obligated to complete the merger.” The complaint alleges that this news caused the Company’s share price to fall from a closing price of $112.25 on September 20, 2007, to close at $85.00 on September 21, 2007, on unusually heavy volume. Then, on September 24, 2007, the complaint alleges that the Company announced that it would fail to meet its financial guidance for the quarter ended September 30, 2007, and needed to significantly reduce its estimates for the FY 2008. According to the complaint, this news caused the Company’s share price to fall to $80.31 on extremely high volume of over 14.5 million shares.

The U.S. Court of Appeals for the D.C. Circuit issued an Opinion on June 23, 2015, reversing the District Court's dismissal of this case and remanding for further proceedings.

On April 19, 2017, the parties entered into a Stipulation of Settlement.

COMPANY INFORMATION:

Sector: Consumer Cyclical
Industry: Audio & Video Equipment
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: HAR
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: D. District Columbia
DOCKET #: 07-CV-01757
JUDGE: Hon. Richard W. Roberts
DATE FILED: 10/01/2007
CLASS PERIOD START: 04/26/2007
CLASS PERIOD END: 09/24/2007
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. Paskowitz & Associates
    60 East 42nd Street, 46th Floor, Paskowitz & Associates, NY 10165
    212.685.0969 212.685.2306 · classattorney@aol.com
  3. Roy Jacobs & Associates (New York)
    350 Fifth Avenue Suite 3000 , Roy Jacobs & Associates (New York), NY 10118
    · classattorney@pipeline.com
No Document Title Filing Date
COURT: D. District Columbia
DOCKET #: 07-CV-01757
JUDGE: Hon. Richard W. Roberts
DATE FILED: 10/16/2015
CLASS PERIOD START: 04/26/2007
CLASS PERIOD END: 02/05/2008
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Cohen Milstein Sellers & Toll PLLC (Washington DC)
    1100 New York Avenue, N.W., Suite 500, West Tower, Cohen Milstein Sellers & Toll PLLC (Washington DC), DC 20005
    202.408.4600 202.408.4600 ·
No Document Title Filing Date
No Document Title Filing Date