Cbeyond Inc. Case 05/06/2008
October 01, 2009
According to a press release from October 01, 2009 the Cbeyond Inc. Case 05/06/2008 has been certified as a class action for settlement purposes only and a Settlement for $2.3 million has been proposed by the Parties.
A hearing will be held before the Honorable Clarence Cooper of the United States District Court for the Northern District of Georgia in the Richard B. Russell Federal Building and Courthouse, 75 Spring Street, SW, Atlanta, GA 30303-3361, at 1:30 p.m., on January 5, 2010, to determine whether the proposed Settlement should be approved by the Court as fair, reasonable and adequate and whether the Settlement Class should be certified and a class representative and class counsel should be appointed and to consider the request of Lead Counsel for attorneys’ fees and reimbursement of litigation expenses. The Court may change the date of the hearing without providing another notice.
May 6, 2008
According to a press release dated May 6, 2008, the lawsuit charges Cbeyond and its founder, Chairman, President and CEO, with violating Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and certain rules thereunder. The case alleges that beginning on November 1, 2007, the defendants made specific misstatements designed to hide the fact that Cbeyond was recording a higher churn rate for its services, which permitted certain of Cbeyond’s officers and directors to engage in insider sales of $39 million of Cbeyond stock at artificially inflated prices. Shortly thereafter, Cbeyond was forced to admit on February 21, 2007 that it elected to make certain operational changes that caused its churn rate to climb even higher, contrary to its prior representations. Cbeyond’s stock price dropped 20% on this shocking news.