Independent Energy Faces Class Action
Independent Energy Holdings PLC, an electric generating and
electric marketing company, has found itself the target of a
federal class action lawsuit for stock fraud brought by the
company's shareholders, according to law firm Berman DeValerio
& Pease LLP.
The lawsuit filed in the District Court for the southern
district of New York claims the defendants issued "false and
misleading information" pertaining to the UK-based company's
financial and operating conditions.
The suit seeks damages for violations of federal securities laws
on behalf of anyone who purchased American depository shares of
Independent Energy between Feb. 12, 2000 and Sept. 8, 2000. During
this class period, the complaint alleges that the defendant
misrepresented the extent of its problems with respect to billing
its sub-100 kW electricity customers.
The suit claims that Independent Energy continually assured
investors that its billing problems were only bill timing problems,
but at the end of the class period, the company revealed there were
also accounting and collection errors. On Aug. 11 of this year,
Independent Energy announced that due to these problems, its
financial results for the year ending June 30, 2000 would be below
analysts' estimates. As a result, the company said it would delay
reporting its results, and on Sept. 8, the London Stock Exchange
and Nasdaq suspended its trading.
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