|  | | 2008 News and Press Releases | | |
SETTLEMENT NEWS:
LeapFrog Enterprises: Reaches Deal in California Securities Suit
Staff Writer
Class Action Reporter. May 21, 2008
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EXCERPT: A tentative settlement was reached in the matter, "In Re LeapFrog Enterprises, Inc. Securities Litigation, Case No. 5:03-cv-05421-RMW," which was filed before the U.S. District Court for the Northern District of California, according to Leapfrog's May 7, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2008. In December 2003, April 2005 and June 2005, six purported class action lawsuits were filed before the U.S. District Court for the Northern District of California against the company and certain of its current and former officers and directors. The suits allege violations of the U.S. Securities Exchange Act of 1934. These actions have been consolidated into a single proceeding captioned, "In Re LeapFrog Enterprises, Inc. Securities Litigation." On Jan. 27, 2006, the lead plaintiffs in the consolidated action filed an amended and consolidated complaint. The suit purports to be a class action seeking unspecified damages on behalf of persons who acquired the company's Class A common stock between July 24, 2003, and Oct. 18, 2004. The complaint alleges that the defendants caused the company to make false and misleading statements about its business and forecasts about its financial performance, that certain of its individual officers and directors sold portions of their stock holdings while in the possession of adverse, non-public information, and that certain of the company's financial statements were false and misleading. In November 2007, the plaintiffs filed a third amended complaint. In February 2008, the parties reached an agreement-in-principle to settle these class actions. The company expects the proposed settlement, which is subject to court approval, to be funded entirely by insurance. The parties are in the process of seeking court approval of the settlement. |
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