The complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. Specifically, during the relevant time period the defendants issued false and misleading statements and/or caused Syntax-Brillian Corporation to issue such statements wherein it was expressly represented and/or implied that Syntax-Brillian Corporation had a viable business that could be restructured and operated as a going concern. Defendants knew that such implied and express representations were materially false and misleading because all defendants knew no later than March 2008 that Syntax-Brillian Corporation could not be operated as a going concern in any form due to reasons not publicly disclosed and which defendants actively concealed and/or aided and abetted the concealment thereof.
NOTE: Syntax-Brillian Corporation has filed a voluntary Chapter 11 petition for bankruptcy. Accordingly, Section 362(a) of the Bankruptcy Code mandates that an automatic stay take effect. But for Section 362(a) of the Bankruptcy Code, Syntax-Brillian Corporation would be named as a defendant in this action.
According to the Memo Endorsement entered on May 6, 2011, the parties have now reached a settlement of the Action; now therefore, in order to conclude the Action and to fulfill the requirements of the parties' settlement agreement, it is hereby stipulated and agreed, by and between the parties to the Action, through their undersigned counsel, that the Action should be dismissed as to defendants FTI Consulting, Inc. ("FTI") and Gregory Rayburn ("Rayburn"), without prejudice. It is hereby further stipulated and agreed that, on the day that is 90 calendar days after the date on which the parties' hereto executed this Stipulation, the dismissal will become a dismissal with prejudice as to FTI, Rayburn, and all Plaintiffs, and Plaintiffs will not be permitted to revive the Action against FTI or Raybum under any circumstances.