Navarre Sued
Posted: Sat Jul 23, 2005 2:24 am
Source: ANN
Is is only for those who care. Otherwise this is very long, very tedious, and very... very long. I found it incredibly interesting even though I never bought stocks or even much care. It's the business man in me, I suppose.
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Navarre directors and executive officers accused of using the announcement regarding the purchase of FUNimation as part of a scheme to fraudulently increase the value of Navarre shares...
Lerach Coughlin Stoia Geller Rudman & Robbins LLP, a 150-lawyer nation-wide law firm, has filed an investor class action lawsuit against Navarre corporation in relation to Navarre's purchase of FUNimation.
Lerach Coughlin alleges several of Navarre's senior executive officers and directors used the announcement regarding the purchase of Funimation, combined with "materially false and misleading statements" regarding Navarre's financial status, to temporarily increase Navarre's stock value to a period high of $18.77. The defendants then sold $13.8 million worth of shares.
Shortly later Navarre withdrew the statement regarding the purchase of FUNimation. According to the complaint, the sudden withdrawal of the statement caused rumors that Navarre's accounting was "problematic." Stock prices then dropped to below $7.
Because the defendants were privy to not-publicly-available information that indicated the true value of the stocks, Lerach Coughlin states that proceeds are from insider trading. Because the defendants disseminated false information and benefited from it, Lerach Coughlin categorizes the acts as fraud.
The complaint states, "Defendants were further motivated to engage in this course of conduct in order to: (i) use 1.3 million shares as currency for it FUNimation acquisition; (ii) obtain a new credit facility on more favorable terms that it would have had the truth about its accounting been known; and (iii) enable Individual Defendants to sell over 994,362 shares of their personally held Navarre stock and thereby reap $13,799.671 million in gross proceeds."
No executives, directors or staff of FUNimation were named as defendants or accomplices in the complaint.
Lerach Coughlin seeks to recover damages on behalf of all those that purchased of Navarre common stock between January 21, 2004 and February 22, 2005.
Addendum: On July 12, 2005, Navarre CFO and Director James G. Gilbertson resigned from the company. Gilbertson is one of the Individual Defendants named in the complaint.
Lerach Coughlin is only one of no less than 13 lawfirms that filed class-actions lawsuits against Navarre in June.
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PRESS RELEASE
June 20, 2005 – Lerach Coughlin Stoia Geller Rudman & Robbins LLP (“Lerach Coughlin”) ( http://www.lerachlaw.com/cases/navarre/ ) today announced that a class action has been commenced in the United States District Court for the District of Minnesota on behalf of purchasers of Navarre Corporation (“Navarre”) (NASDAQ:NAVR) common stock during the period between January 21, 2004 and February 22, 2005 (the “Class Period”).
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from June 13, 2005. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, William Lerach or Darren Robbins of Lerach Coughlin at 800/449-4900 or 619/231-1058, or via e-mail at [email protected]. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.lerachlaw.com/cases/navarre/ . Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Navarre and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Navarre engages in the publication and distribution of various home entertainment and multimedia products, including personal computer software, audio and video titles, and interactive games.
The complaint alleges that during the Class Period, defendants made materially false and misleading statements regarding the companies business and financial results. On January 10, 2005, Navarre announced the acquisition of FUNimation Productions, Ltd. and The FUNimation Store, Ltd. (collectively “FUNimation”) for $100 million in cash and between 1.495 million and 1.827 million shares of Navarre stock, depending on the price of Navarre stock. After this announcement, Navarre’s stock reached its Class Period high of $18.77 per share. Defendants took advantage of the inflation in Navarre’s stock during the Class Period, selling 994,362 shares of Navarre stock for proceeds of $13.8 million.
On January 18, 2005, Navarre filed a registration statement with the SEC to raise up to $140 million through the sale of its common stock to fund the acquisition of FUNimation. On January 26, 2005, Navarre reported favorable third quarter fiscal 2005 results, which, according to defendants, reflected “the continuing execution of our strategic plan.” Then, on February 22, 2005, the Company suddenly withdrew its Registration Statement initially filed for purposes of funding its acquisition of FUNimation. According to the complaint, this sudden withdrawal reignited rumors that the Company’s accounting was problematic. On this news, the stock dropped to below $7 per share.
Later, on May 31, 2005, the Company issued a press release entitled “Navarre Corporation to Postpone Release of Fourth Quarter and Fiscal Year 2005 Financial Results and Related Investor Conference Call.” The press release stated in part: “The Company is presently determining the amount and timing of recognition of deferred compensation expense related to the Company’s Chief Executive Officer’s 2001 employment agreement, as amended December, 2003, which have been on file with the Securities and Exchange Commission. The Company is also reviewing the recognition and classification of certain fiscal 2005 tax items.”
Plaintiff seeks to recover damages on behalf of all purchasers of Navarre common stock during the Class Period (the “Class”). The plaintiff is represented by Lerach Coughlin, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Lerach Coughlin, a 150-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Washington, D.C., Houston, Philadelphia and Seattle, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. Lerach Coughlin lawyers have been responsible for more than $20 billion in aggregate recoveries. The Lerach Coughlin Web site ( http://www.lerachlaw.com ) has more information about the firm.
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THE FULL 29-PAGE COMPLAINT
Can be read at the following: http://www.lerachlaw.com/cases/navarre/complaint.pdf .
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Enjoy...! I also have the PDF complaint in case the link refuses to work (for anyone interested still). I will always be on my machine... It's just too good a legal action in the anime world to toss away and never remember.
Is is only for those who care. Otherwise this is very long, very tedious, and very... very long. I found it incredibly interesting even though I never bought stocks or even much care. It's the business man in me, I suppose.
- - - -
Navarre directors and executive officers accused of using the announcement regarding the purchase of FUNimation as part of a scheme to fraudulently increase the value of Navarre shares...
Lerach Coughlin Stoia Geller Rudman & Robbins LLP, a 150-lawyer nation-wide law firm, has filed an investor class action lawsuit against Navarre corporation in relation to Navarre's purchase of FUNimation.
Lerach Coughlin alleges several of Navarre's senior executive officers and directors used the announcement regarding the purchase of Funimation, combined with "materially false and misleading statements" regarding Navarre's financial status, to temporarily increase Navarre's stock value to a period high of $18.77. The defendants then sold $13.8 million worth of shares.
Shortly later Navarre withdrew the statement regarding the purchase of FUNimation. According to the complaint, the sudden withdrawal of the statement caused rumors that Navarre's accounting was "problematic." Stock prices then dropped to below $7.
Because the defendants were privy to not-publicly-available information that indicated the true value of the stocks, Lerach Coughlin states that proceeds are from insider trading. Because the defendants disseminated false information and benefited from it, Lerach Coughlin categorizes the acts as fraud.
The complaint states, "Defendants were further motivated to engage in this course of conduct in order to: (i) use 1.3 million shares as currency for it FUNimation acquisition; (ii) obtain a new credit facility on more favorable terms that it would have had the truth about its accounting been known; and (iii) enable Individual Defendants to sell over 994,362 shares of their personally held Navarre stock and thereby reap $13,799.671 million in gross proceeds."
No executives, directors or staff of FUNimation were named as defendants or accomplices in the complaint.
Lerach Coughlin seeks to recover damages on behalf of all those that purchased of Navarre common stock between January 21, 2004 and February 22, 2005.
Addendum: On July 12, 2005, Navarre CFO and Director James G. Gilbertson resigned from the company. Gilbertson is one of the Individual Defendants named in the complaint.
Lerach Coughlin is only one of no less than 13 lawfirms that filed class-actions lawsuits against Navarre in June.
- - - -
PRESS RELEASE
June 20, 2005 – Lerach Coughlin Stoia Geller Rudman & Robbins LLP (“Lerach Coughlin”) ( http://www.lerachlaw.com/cases/navarre/ ) today announced that a class action has been commenced in the United States District Court for the District of Minnesota on behalf of purchasers of Navarre Corporation (“Navarre”) (NASDAQ:NAVR) common stock during the period between January 21, 2004 and February 22, 2005 (the “Class Period”).
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from June 13, 2005. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, William Lerach or Darren Robbins of Lerach Coughlin at 800/449-4900 or 619/231-1058, or via e-mail at [email protected]. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.lerachlaw.com/cases/navarre/ . Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Navarre and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Navarre engages in the publication and distribution of various home entertainment and multimedia products, including personal computer software, audio and video titles, and interactive games.
The complaint alleges that during the Class Period, defendants made materially false and misleading statements regarding the companies business and financial results. On January 10, 2005, Navarre announced the acquisition of FUNimation Productions, Ltd. and The FUNimation Store, Ltd. (collectively “FUNimation”) for $100 million in cash and between 1.495 million and 1.827 million shares of Navarre stock, depending on the price of Navarre stock. After this announcement, Navarre’s stock reached its Class Period high of $18.77 per share. Defendants took advantage of the inflation in Navarre’s stock during the Class Period, selling 994,362 shares of Navarre stock for proceeds of $13.8 million.
On January 18, 2005, Navarre filed a registration statement with the SEC to raise up to $140 million through the sale of its common stock to fund the acquisition of FUNimation. On January 26, 2005, Navarre reported favorable third quarter fiscal 2005 results, which, according to defendants, reflected “the continuing execution of our strategic plan.” Then, on February 22, 2005, the Company suddenly withdrew its Registration Statement initially filed for purposes of funding its acquisition of FUNimation. According to the complaint, this sudden withdrawal reignited rumors that the Company’s accounting was problematic. On this news, the stock dropped to below $7 per share.
Later, on May 31, 2005, the Company issued a press release entitled “Navarre Corporation to Postpone Release of Fourth Quarter and Fiscal Year 2005 Financial Results and Related Investor Conference Call.” The press release stated in part: “The Company is presently determining the amount and timing of recognition of deferred compensation expense related to the Company’s Chief Executive Officer’s 2001 employment agreement, as amended December, 2003, which have been on file with the Securities and Exchange Commission. The Company is also reviewing the recognition and classification of certain fiscal 2005 tax items.”
Plaintiff seeks to recover damages on behalf of all purchasers of Navarre common stock during the Class Period (the “Class”). The plaintiff is represented by Lerach Coughlin, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Lerach Coughlin, a 150-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Washington, D.C., Houston, Philadelphia and Seattle, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. Lerach Coughlin lawyers have been responsible for more than $20 billion in aggregate recoveries. The Lerach Coughlin Web site ( http://www.lerachlaw.com ) has more information about the firm.
- - - -
THE FULL 29-PAGE COMPLAINT
Can be read at the following: http://www.lerachlaw.com/cases/navarre/complaint.pdf .
- - - -
Enjoy...! I also have the PDF complaint in case the link refuses to work (for anyone interested still). I will always be on my machine... It's just too good a legal action in the anime world to toss away and never remember.