LITTLE ROCK, Ark., Oct. 26, 2001 (PRIMEZONE) -- The Law Firm of Cauley Geller Bowman & Coates, LLP announced today that a class action has been filed in the United States District Court for the Northern District of Georgia on behalf of purchasers of Internet Security Systems, Inc. ("ISS" or the "Company") (Nasdaq:ISSX) publicly traded securities during the period between April 1, 2001 and July 2, 2001, inclusive (the "Class Period"). A copy of the complaint filed in this action is available from the Court, or can be viewed on the firm's website at http://www.classlawyer.com/pr/internet_security.pdf.
The complaint charges ISS and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that defendants made materially false and misleading representations regarding the Company's revenues and earnings for the first and second quarters of fiscal year 2001 which artificially inflated the price of ISS stock. Specifically, the complaint charges that on April 18, 2001, ISS reported its 23rd consecutive quarter of growth. For the first quarter of 2001, it claimed revenues in excess of $61 million and net income of $6.5 million or $0.15 per share. ISS claimed that the Company's "financial performance continued to show strength and our solid execution and focus on expense control enabled us to meet our profit guidance provided at the beginning of the quarter." ISS claimed on April 18, 2001 that its guidance for the second quarter ending June 30, 2001 was to produce revenues between $64 and $67 million and earnings in the range of $0.15 per diluted share, even though defendants knew they could not achieve these numbers. ISS claimed in its April 18, 201 press release that "the public can continue to rely on the expectations published in its earnings release and web site as being its current expectations on matters covered, unless ISS publishes a notice stating otherwise. Defendants, who were in control of ISS during the class period, knew that their business was slowing down, because they received financial reports on a frequent basis, and knew that they had too many employees in view of the slowdown.
On July 2, 2001, after the quarter had ended, ISS issued a press release in which it stated that ISS' management expected revenues in the range of $50-52 million, not $64-67 million, and a loss per diluted share between $0.00 to $0.02, rather than earnings of $0.15 to $0.16. Just after the July 18, 2001 press conference in which ISS released its actual numbers, and admitted that it had over hired and over indulged on fringe benefits, travel and entertainment, ISS laid off 12% of its work force, confirming what its executives had known or recklessly disregarded throughout the Class Period, that it had too many employees and greater expenses than it could afford, given its level of sales. Class members who had bought ISS shares during the Class Period - when ISS told them they could rely on its guidance - found out on the morning of July 3, 2001 that ISS had tumbled more than 40 percent.
If you bought the securities of ISS between April 1, 2001 and July 2, 2001 inclusive, and you wish to serve as lead plaintiff, you must move the Court no later than November 28, 2001. If you are a member of this class, you can join this class action online at http://www.classlawyer.com/sign_up.html. Any member of the purported class may move the Court to serve as lead plaintiff through Cauley Geller Bowman and Coates, LLP or other counsel of their choice, or may choose to do nothing and remain an absent class member.
Cauley Geller Bowman & Coates, LLP has substantial experience representing investors in securities fraud class action lawsuits such as this. The firm has offices in Florida, Arkansas and California, but represents investors throughout the nation. If you have any questions about how you may be able to recover for your losses, or if you would like to consider serving as one of the lead plaintiffs in this lawsuit, you are encouraged to call or e-mail the Firm or visit the Firm's website at www.classlawyer.com.
CAULEY GELLER BOWMAN & COATES, LLP Investor Relations Department: Jackie Addison, Sue Null or Charlie Gastineau P.O. Box 25438 Little Rock, AR 72221-5438 Toll Free: 1-888-551-9944 E-mail: info@classlawyer.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.