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Case Status:    SETTLED
On or around 10/14/2010 (Date of order of final judgment)

Filing Date: November 27, 2007

The original complaint charges Leap and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Leap is a wireless communications carrier that offers digital wireless service under the Cricket Communications, Inc. and Jump Mobile brands in the United States.

Specifically, the complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business, prospects and financial results. As a result of defendants’ false statements, Leap stock traded at artificially inflated prices during the Class Period, reaching its all-time high of $98.33 per share in July 2007.

On August 7, 2007, Leap announced disastrous second quarter 2007 results, including missing its revenue projections, soaring expenses and a high customer turnover rate, causing its stock to decline from $80.36 per share on August 7, 2007 to $60.00 per on August 8, 2007 – a one-day decline of 25%. Then, on November 9, 2007, before the market opened, defendants disclosed that Leap would be required to restate its financial statements for fiscal years 2004, 2005, 2006 and for the first and second quarters of fiscal year 2007 to correct for errors in its previously reported service revenues, equipment revenues and operating expenses, causing its stock to drop $21.38 per share.

According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows: (a) the Company’s financial statements were materially misstated due to its failure to properly account for its service revenue in violation of Generally Accepted Accounting Principles (“GAAP”); (b) the Company’s financial statements were materially misstated due to its failure to properly account for its equipment revenue and cost of equipment in violation of GAAP; (c) the Company lacked requisite internal controls, and, as a result, the Company’s projections and reported results issued during the Class Period were based upon defective assumptions and/or manipulated facts; and (d) given the Company’s exposure to subprime consumers and the intense competition in the low-cost cell carriers market Leap was facing, the Company had no reasonable basis to make projections about its ability to maintain its customer turnover rate and net customer additions. As a result, the Company’s projections issued during the Class Period were at a minimum reckless.

On May 22, 2008, U.S. District Judge Barry Ted Moskowitz granted the motions to consolidate several actions and granted the motions to appoint New Jersey Carpenters Pension and Benefit Fund as lead plaintiff and approving lead counsel selection. On July 7, 2008, the plaintiff filed a Consolidated Class Action Complaint. On August 28, 2008, the defendants PricewaterhouseCoopers LLP, Leap Wireless International, Inc., and the individual defendants filed three separate motions to dismiss the Consolidated Class Action Complaint. On January 9, 2009, District Court Judge Michael M. Anello issued three orders granting the defendants’ three motions to dismiss the consolidated class action complaint without prejudice. Amended pleadings are due by February 23, 2009.

On March 10, 2009, the lead plaintiff filed a Second Amended Consolidated Class Action Complaint. On May 1, 2009, Judge Michael M. Anello granted the Lead Plaintiff’s motion for substitution of Lead Counsel. According to the Order, the law firm of Cohen Milstein Sellers & Toll, PLLC is appointed and shall hereinafter serve as Lead Counsel for plaintiffs and the Class. On May 26, 2009, the defendant filed a motion to dismiss the Second Amended Class Action Complaint.

On November 13, 2009, Judge Michael M. Anello signed an Order setting hearing on the motion to dismiss the Second Amended Class Action Complaint. According to the Order, the Parties have informed the Court that they have reached a settlement. Accordingly, the Court hereby continues the hearing on Defendants' motion to dismiss to February 1, 2010, before Judge Michael M. Anello. Upon the parties' filing of the motion for preliminary approval of the class settlement, Defendants shall withdraw the motion to dismiss.

According to an article dated February 19, 2010, Wireless communications provider Leap Wireless International Inc. has struck a $13.75 million deal to resolve a putative securities class action accusing it and several executives of making misrepresentations and omissions that inflated its stock price and ended up costing investors hundreds of millions of dollars. Lead plaintiff New Jersey Carpenters Pension and Benefit Funds filed an "unopposed" motion Thursday in the U.S. District Court for the Southern District of California seeking preliminary approval.

On March 24, 2010, the settlement was preliminarily approved. A Settlement Fairness Hearing shall be held on Monday October 4, 2010, before the Honorable Michael M. Anello.

On October 14, 2010, Judge Anello approved the settlement and dismissed the action with prejudice. On October 15, 2010, the motion for attorneys' fees and reimbursement of expenses was approved.

COMPANY INFORMATION:

Sector: Services
Industry: Communications Services
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: LEAP
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: S.D. California
DOCKET #: 07-CV-2245
JUDGE: Hon. Barry Ted Moskowitz
DATE FILED: 11/27/2007
CLASS PERIOD START: 05/16/2004
CLASS PERIOD END: 11/09/2007
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Brodsky & Smith, LLC (former Pennysylvania)
    11 Bala Avenue, Suite 39, Brodsky & Smith, LLC (former Pennysylvania), PA 19004
    610.668.7987 610.660.0450 · esmith@Brodsky-Smith.com
  2. Coughlin Stoia Geller Rudman & Robbins LLP (San Diego)
    655 West Broadway, Suite 1900, Coughlin Stoia Geller Rudman & Robbins LLP (San Diego), CA 92101
    619.231.1058 619.231.7423 · info@csgrr.com/
  3. Glancy Binkow & Goldberg LLP (Los Angeles)
    1801 Ave. of the Stars, Suite 311, Glancy Binkow & Goldberg LLP (Los Angeles), CA 90067
    310.201.915 310. 201-916 · info@glancylaw.com
  4. Kaplan Fox & Kilsheimer, LLP (former New York, NY)
    805 Third Avenue, 22nd Floor, Kaplan Fox & Kilsheimer, LLP (former New York, NY), NY 10022
    212.687.1980 212.687.7714 · info@kaplanfox.com
  5. Lockridge, Grindal, Nauen P.L.L.P.
    Suite 301, 660 Pennsylvania Avenue Southeast, Lockridge, Grindal, Nauen P.L.L.P., DC 20003-4335
    202.544.9840 202.544.9850 ·
No Document Title Filing Date
COURT: S.D. California
DOCKET #: 07-CV-02245
JUDGE: Hon. Barry Ted Moskowitz
DATE FILED: 03/10/2009
CLASS PERIOD START: 08/02/2006
CLASS PERIOD END: 12/26/2007
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Schoengold & Sporn PC (New York)
    19 Fulton Street, Schoengold & Sporn PC (New York), NY 10038
    212.964.0046 212.267.8130 · Shareholderrelations@spornlaw.com
No Document Title Filing Date
No Document Title Filing Date