US Unwired Agrees to Settlement In Shareholder Class Action
August 2010 - If you purchased US Unwired, Inc. (“US Unwired” or the “Company”) common stock during the period from May 7, 2001 to July 18, 2002, inclusive (the “Settlement Class Period”) and are not otherwise excluded from the Settlement Class, you could get a payment from a class action settlement.
Defendants have agreed to pay, or cause to be paid on their behalf, $9,700,000 in cash (the “Settlement Fund”). The Settlement Fund, plus interest earned from the date it is established, less costs, fees and expenses (the “Net Settlement Fund”), will be divided among all eligible Settlement Class Members who send in valid claim forms (“Authorized Claimants”).
The Court will hold a hearing on December 17, 2010, at the United States District Court for the Eastern District of Louisiana. At this hearing, the Court will consider whether the settlement is fair, reasonable and adequate.
November 2004 - In a complaint that charges defendants (US Unwired) with violations of the Securities Exchange Act of 1934, the Court entered the Order consolidating the cases and establishing a master file. US Unwired holds direct or indirect ownership interests in five Sprint PCS affiliates: Louisiana Unwired, Texas Unwired, Georgia PCS, IWO Holdings and Gulf Coast Wireless. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) the Company was increasing its subscriber base by signing up high-credit-risk customers; (2) that accounting changes implemented by the Company were done in order to conceal the Company's declining revenues; (3) that the Company had been experiencing high involuntary disconnections related to its high-credit- risk customers; (4) that the Company experienced lower subscription growth as a result of its policy that required credit-challenged customers to pay substantial deposits upon the initiation of services; and (5) that the Company was engaged in a dispute with Sprint PCS regarding its business relationship with Sprint PCS and Sprint PCS was pressuring the Company. The complaint further alleges that on August 13, 2002, US Unwired announced in a press release the financial results for the second quarter period ended June 30, 2002. The Company revealed that it experienced lower subscription growth as a result of its policy that required credit-challenged customers to pay substantial deposits upon the initiation of services. In response to this string of negative announcements, on August 13, 2002, the price of US Unwired common stock closed at $.90 per share, down 94.8% from its Class Period high of $17.25 per share.