CHICAGO, Ill., June 21, 2002 (PRIMEZONE) -- Much Shelist Freed Denenberg Ament & Rubenstein, P.C. announces that class action lawsuits are pending in the United States District Court for the Southern District of New York on behalf of purchasers of the securities of Omnicom Group, Inc. ("Omnicom" or the "Company") (NYSE:OMC) between April 25, 2000 and June 11, 2002, inclusive ("Class Period").
It has been alleged that Omnicom, John D. Wren, Randall J. Weisenburger, Bruce Crawford and Philip J. Angelastro violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of materially false and misleading statements to the market.
According to the allegations, before and throughout the Class Period, Omnicom reported that it was continuing to experience growth in its revenues and earnings, despite the overall economic slowdown and the worst decline in advertising revenue that the industry had ever experienced. Omnicom's growth was attributed, for the most part, to the numerous acquisitions made by the Company, which were accretive to the Company's earnings. However, on June 12, 2002, an article in The Wall Street Journal highlighted the Company's acquisition accounting and raised questions concerning the Company's creation of an off-balance sheet entity in which it transferred certain Internet investments. Specifically, with respect to the Company's accounting for acquisitions, the article noted that:
(i) Omnicom immediately included revenue and earnings from recent
acquisitions in its reported financial results, in contrast to
its competitors who excluded the results for the first year
after the company was acquired, thereby creating a materially
misleading impression of the Company's performance;
(ii) Omnicom continued to owe hundreds of millions of dollars in
additional payments for companies that it had previously
acquired; and
(iii) Omnicom faced a potential future liability whereby, under
certain circumstances, it might be required to acquire
companies in which it had invested.
With respect to the off-balance sheet entity, the article described the Company's transfer of its Internet investments to Seneca, which had been jointly created with Pegasus Capital LLP in May 2001. According to the article, Seneca had been created as a vehicle for the Company to avoid reporting a loss on its investments in Internet companies that had become devalued.
In response to the revelations contained in The Wall Street Journal article, the price of Omnicom common stock dropped precipitously, falling almost 20% to close at $62.28, on volume of more than 31 million shares traded.
Much Shelist is currently investigating these claims. If you wish to discuss your rights and interests, or if you have information relevant to the lawsuit, you may contact Carol V. Gilden or Michael E. Moskovitz at Much Shelist Freed Denenberg Ament & Rubenstein, P.C., by calling a toll-free number 1-800-470-6824, or by sending an e-mail to investorhelp@muchshelist.com. Your e-mail should refer to Omnicom.
If you purchased Omnicom securities during the Class Period and if you meet certain other legal requirements, you may file a motion in the court where the lawsuit has been filed to serve as a lead plaintiff. You must file your motion no later than August 12, 2002.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. The requirements for serving as a lead plaintiff are set forth in the Private Securities Litigation Reform Act of 1995 (15 U.S.C. Section 78u-4).
Much Shelist's history is one of experience, leadership and results. For more than 25 years, Much Shelist has represented plaintiffs in class action litigation in federal and state courts across the United States. The firm has successfully prosecuted cases involving securities fraud, antitrust violations, consumer fraud, unlawful business practices and insurance company fraud. Under Much Shelist's leadership, class members have obtained judgments and settlements in excess of $4 billion.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca