By Orders filed September 29, 2003, the Honorable Shira A. Scheindlin, United States District Court Judge for the Southern District Court of New York, gave her final approval to two settlements totaling $48 million in cash, which resolved all remaining claims in the litigation.
At a preliminary approval hearing on June 12, 2003, the Court granted preliminary approval of two settlements totaling $48 million to resolve the securities fraud class action pending against certain of Independent Energy Holdings PLC's former directors and officers, Donaldson, Lufkin & Jenrette Securities Corp., Prudential Securities Inc., Johnson Rice & Company L.L.C. (the underwriters of a secondary public offering of stock that occurred on March 28, 2000), and certain related parties.
The class action was brought on behalf of all persons or entities who purchased Independent Energy Holdings PLC American Depository Shares ("ADSs"), and Ordinary Shares if residing in the United States or its territories at the time of purchase, during the period between February 14, 2000 and September 8, 2000, inclusive (the "Class Period"). The Complaint asserts claims arising under sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. In particular, the Complaint alleges that, during the Class Period, all of the defendants violated the federal securities laws as a result of their issuance of a false and misleading Registration Statement and Prospectus in connection with a secondary offering of ADSs on March 28, 2000. It further alleges that certain of the Company's former directors and officers violated the federal securities laws as a result of their issuance of false and misleading statements in press releases, and statements made by the Company's management on conference calls with analysts that covered Independent Energy.
On September 19, 2002, the Court granted preliminary approval of a partial settlement that resolved the Class' claims against Independent Energy Holdings PLC and Independent Energy U.K. Limited in exchange for their consent to the production of documents and testimony from various non-parties in the U.K. which were essential to the prosecution of the Class' claims against the Individual Defendants and the Underwriter and Related Defendants. At the time this partial settlement was reached, both Holdings and Limited were in receivership. Pursuant to the Order granting preliminary approval of the Holdings/Limited Settlement, the Court-approved Notice of Pendency and Partial Settlement of Class Action was mailed to Class members. For a copy of that Notice, click here. On December 17, 2002, the Court approved the partial settlement and entered an Order and Final Judgment dismissing all claims against Independent Energy Holdings PLC and Independent Energy U.K. Limited.
The original complaint alleges that the defendants issued materially false and misleading information regarding Independent Energy's financial and operating condition. Specifically, the complaint charges that defendants misrepresented the extent of its problems with respect to billing its sub-100 kilowatt electricity customers. During the Class Period, defendants consistently assured investors its billing problems were limited to the timing of bills.