New Lead Plaintiff Appointed In Imax Securities Case

New Lead Plaintiff Appointed In Imax Securities Case - 6/30/2009

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2009 News and Press Releases

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News	News 2009
HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

SETTLEMENT NEWS:

New Lead Plaintiff Appointed In Imax Securities Case
Morgan Bettex

Securities Law 360. June 30, 2009
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EXCERPT: A federal judge has replaced the lead plaintiff in securities litigation against Imax Corp., concluding that another shareholder group is more suitable for the role because it suffered a direct loss from the movie pioneer's alleged fraud. Judge Naomi Reice Buchwald of the U.S. District Court for the Southern District of New York on Monday granted a motion by Snow Capital Investment Partners LP to reconsider the appointment of Westchester Capital Management Inc. as the top plaintiff in the consolidated cases. Snow Capital — an investment partnership represented by Coughlin Stoia Geller Rudman & Robbins LLP — sought status as lead plaintiff in March, arguing that WCM was an investment adviser that had not directly suffered any loss from Imax's alleged securities fraud but was merely claiming loss on behalf of five funds. WCM was appointed lead plaintiff in January 2007 after arguing that the funds it advised had suffered the greatest loss in the aggregate of any Imax shareholders. Imax, its top executives and its auditor PricewaterhouseCoopers LLP were hit with five proposed securities class actions on or around Aug. 11, 2006, two days after it was revealed that the company was under investigation by the U.S. Securities and Exchange Commission for possible accounting fraud. The plaintiffs — purchasers of Imax common stock — accuse the movie giant of issuing misleading news releases that proclaimed the company's financial success. According to the complaint, Imax admitted that it had identified a "material weakness" related to revenue-recognition issues and that the company knew that revenue was being improperly recognized but refused to correct the problem. In November 2008, WCM moved for class certification of the consolidated actions, but Judge Buchwald denied that bid in order to consider Snow Capital's motion.

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