NEW YORK, Oct. 4, 2002 (PRIMEZONE) -- The law firm of Wechsler Harwood LLP announces that a class action has been commenced in the United States District Court for the Eastern District of Texas on behalf of purchasers of Fleming Companies Inc. ("Fleming" or the "Company") (NYSE:FLM) common stock during the period between May 9, 2001 and September 4, 2002 (the "Class Period").
The complaint alleges that Fleming and certain of its officers and directors violated the Securities Exchange Act of 1934. Fleming is a wholesale food distributor, supplying brand-name and private-label food and general merchandise to thousands of retailers. It also owns more than 100 stores which operate under the Food4Less and Rainbow Foods banners. The complaint alleges that during the Class Period, Fleming issued false statements, including false financial results in which the Company included income from vendor discounts to which Fleming was not entitled.
As a result of defendants' false statements, the Company's stock traded at artificially inflated levels, as high as $37.30 per share, permitting Fleming to complete an 8 million share secondary stock offering, a $200 million Note offering and the acquisition of Core-Mark International in the spring of 2002. Also, due to Fleming's artificially inflated earnings, its CEO and CFO received bonuses for 2001 of $2.6 million and $1.15 million, respectively.
On September 5, 2002, Fleming announced its estimates would need to be reduced. On the same day, The Wall Street Journal discussed Fleming's practice of taking excessive deductions on the amounts it owed to vendors. The article mentioned an executive of the Company who resigned due to his objection to the practice, and also indicated that some vendors refused to ship to Fleming because of disputes with Fleming over the practice. Once this news was revealed, Fleming's stock collapsed to $6.87 before closing at $6.92, some 80% below the Class Period high of $37.30.
If you purchased Fleming securities during the Class Period, you may, no later than October 28, 2002 move to be appointed as a Lead Plaintiff in this class action. 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. You may retain Wechsler Harwood, or other counsel of your choice, to serve as your counsel in this action.
Wechsler Harwood, which has extensive experience in prosecuting investor class actions involving financial fraud, has prosecuted securities, antitrust and consumer class actions for over 10 years. For more information about Wechsler Harwood LLP, please visit its website at www.whesq.com.
If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following:
Wechsler Harwood LLP 488 Madison Avenue, 8th Floor New York, New York 10022 Toll Free Telephone: (877) 935-7400 Shareholder Relations Department: dleifer@whesq.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.