ST. PAUL, Minn., April 27, 2006 (PRIMEZONE) -- Reinhardt Wendorf & Blanchfield announces that a class action lawsuit was filed in the United States District Court for the District of Minnesota, on behalf of purchasers of The Estee Lauder Companies, Inc.("Estee Lauder" or "The Company") (NYSE:EL) common stock during the period between April 28, 2005, and October 25, 2005, inclusive (the "Class Period").
If you wish to serve as lead plaintiff, you must move the Court no later than May 29, 2006. If you wish to discuss this case or have questions concerning this case or your rights or interests, please contact: Garrett D. Blanchfield of Reinhardt Wendorf & Blanchfield at 800-465-1592 or 651-287-2100, via facsimile at 651-287-2103 or via email at g.blanchfield@rwblawfirm.com. For more information about Reinhardt Wendorf & Blanchfield, visit our website at www.rwblawfirm.com.
The complaint charges Estee Lauder and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Among other things, plaintiff claims that defendants' material omissions and dissemination of materially false and misleading statements concerning Estee Lauder's financial performance and prospects caused the Company's stock price to become artificially inflated, inflicting damages on investors. Estee Lauder is a global manufacturer of skin care, makeup, fragrance and hair care products. The Complaint alleges that the Company's market share was decreasing at the commencement of the Class Period, and, rather than reverse this negative trend or fully disclose it, defendants launched a largely successful campaign that employed channel stuffing and the dissemination of materially false and misleading statements to prop up reported revenues and earnings and the Company's share price long enough for Company insiders to sell millions of their personally held Estee Lauder shares to unsuspecting investors at prices that were artificially inflated by defendants' false and misleading statements.
On September 19, 2005, defendants disclosed that the Company would not meet its guidance for the first half of fiscal 2006, causing the Company's stock to fall 9%, from $40.51 to $36.05 per share. Estee Lauder shares, however, continued to trade at artificially inflated levels until October 26, 2005, when defendants were forced to disclose fiscal first-quarter 2006 earnings of only $61.8 million, or $0.28 per share -- down 38% from the prior year's earnings of $95.7 million, or $0.41 per share -- on essentially flat sales. These results were well below analysts' revised consensus earnings estimate of $0.32 per share on revenue of $1.54 billion. Following this disclosure, the Company's share price fell to $30.71. By this time, Estee Lauder insiders had, during the Class Period, sold 3,380,399 shares of their Estee Lauder common stock to unwitting investors for proceeds of $88,077,150. Plaintiff seeks to recover damages on behalf of all purchasers of Estee Lauder stock during the Class Period. The plaintiff is represented by Reinhardt Wendorf & Blanchfield, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Reinhardt Wendorf & Blanchfield and its predecessor firm have devoted its practice to shareholder class actions and complex commercial litigation for more than thirty years and have recovered hundreds of millions of dollars for shareholders in class actions throughout the United States.
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