Symbol Technologies Inc (NYSE: SBL) Investor Securities Class Action Lawsuit 03/05/2002

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Company Name(s): 
Symbol Technologies
Case Name: 
Symbol Technologies Inc Shareholder Class Action Lawsuit 03/05/2002
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Approved
Affected Securities
NYSE: SBL
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
09/27/2002
Class Period Begin: 
02/15/2000
Class Period End: 
10/17/2002
Court of Filing: 
U.S. District Court for the Eastern District of New York
Date Settled: 
10/14/2004
Settlement Amount: 
$102,000,000
Deadline to Participate in Settlement: 
10/29/2004
Summary: 

July 21, 2005 - The court ordered the authorization of a second distribution of net settlement funds.

February 23, 2005 - The court ordered the authorization of the distribution of the net settlement fund.

October 14, 2004 - The court approved the settlement, entered the orders approving the plan of allocation, the motion for attorneys’ fees and expenses, and dismissed the action with prejudice.

September 22, 2004 - Parties filed a supplemental stipulation of settlement.

June 9, 2004 - The court preliminarily approved the settlement.

June 8, 2004 - Parties filed a stipulation of settlement.

September 22, 2003 - The court denied the defendants motions to dismiss.

March 21, 2003 - Another investor filed a complaint.

February 28, 2003 - The defendants filed motions to dismiss.

September 27, 2002 - The lead plaintiffs filed an amended consolidated complaint on behalf of investors who purchased Symbol Technologies Inc (NYSE: SBL) common shares between April 26, 2000 and April 18, 2002. The lead plaintiffs allege that the defendants violated the Securities Exchange Act of 1934 by issuing false and misleading statements between April 26, 2000 and April 18, 2002.

July 16, 2002 - The lead plaintiffs and lead counsel were appointed and all cases were consolidated.

May 6, 2002 - Lead plaintiff motions were filed.

March 05, 2002 - An investor in shares of Symbol Technologies Inc (NYSE: SBL) filed a lawsuit in the U.S. District Court for the Eastern District of New York against Symbol Technologies Inc over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between October 19, 2000 and February 13, 2002.

Specifically, the complaint alleges that defendants engaged in the following conduct which had the effect of increasing Symbol Technologies Inc’s reported revenue and profits: (1) Symbol Technologies Inc booked as profit in the third quarter 2000 a one-time royalty payment in excess of $10 million, enabling Symbol Technologies Inc to make its third quarter projections; (2) Symbol Technologies Inc used expenses associated with its acquisition of Telxon to mask the fact that its sales were declining; and (3) Symbol Technologies Inc booked as having shipped in the first quarter of 2001 more than $40 million in inventory that included side provisions allowing customers to delay payments or return merchandise, or included products that “never left the warehouse.” Symbol Technologies Inc subsequently had a second-quarter 2001 inventory write-down of $67.1 million after tax. On February 13, 2002, Newsday, Inc. reported that Symbol Technologies Inc had engaged in the above-described accounting practices, received an inquiry letter from the Securities and Exchange Commission, and had hired accounting and consulting firm KPMG to review its sales process. The next day, Symbol Technologies Inc announced it was lowering its outlook for 2002 earnings and that its Chief Executive Officer would retire in May 2002. In response to the Newsday article and Symbol Technologies Inc’s announcements, the price of Symbol Technologies Inc (NYSE: SBL) stock plunged more than 53% from an opening price of $14.15 on February 14, 2002 to a low of $6.60 on February 15, 2002 on unusually heavy trading volume.