BALA CYNWYD, Pa. Dec. 5, 2001 (PRIMEZONE) - Schiffrin & Barroway, LLP announced today that it recently filed lawsuits on behalf of shareholders of CareScience, Inc., NetEase.com, Inc., NextCard, Inc. and Aetna, Inc. for violations of the federal securities laws.
CARESCIENCE, INC. (Nasdaq:CARE) (Class Period: 06/29/00 - 11/01/00) The complaint charges CareScience and certain of its officers and directors with issuing false and misleading statements concerning its Prospectus and Registration Statement (the "Prospectus"). Specifically, the complaint alleges that the Prospectus was materially false and misleading because, among other things, it misrepresented and omitted to disclose material facts concerning two of the Company's products. Specifically, the complaint alleges that the Prospectus highlighted Careleader.com and Caresense.com, which were expected to significantly contribute to the Company's future performance, and provided detailed descriptions of their features, including an anticipated rollout date in 2001. The complaint alleges that these statements were materially false and misleading because they failed to disclose that, given the environment for Internet-based health applications, the Company's Careleader.com and Caresense.com products, which were in development and not complete, would no longer be economically feasible to continue developing. Accordingly, the further development of those products would have to be abandoned and the sales the Company expected from those products would not be realized. On November 1, 2000, the Company announced that it was revising its revenue estimates for 2001, in part, because of its decision to discontinue its Careleader.com and Caresense.com products. In response to this announcement, the price of CareScience common stock dropped to $1.6875 per share. The complaint was filed in the United States District Court for the Eastern District of Pennsylvania, located at 2609 U.S. Courthouse, Independence Mall West, 601 Market Street, Philadelphia, PA 19106. The lead plaintiff motion must be filed no later than December 17, 2001.
NETEASE.COM, INC. (Nasdaq:NTESE) (Class Period: 07/03/00 - 08/31/01). The complaint charges NetEase.com, Inc. and certain of its officers, directors and underwriters with issuing false and misleading statements concerning its business and financial condition. Specifically, the complaint alleges that defendants NetEase.com, King F. Lai, William Lei Ding, Helen Haiwen He, Merrill Lynch, Pierce, Fenner & Smith, Incorporated, Deutsche Bank Securities, Inc., Chase Securities, Inc., Salomon Smith Barney, Inc. and UBS Warburg LLC violated Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between July 3, 2000 and August 31, 2001. On May 8, 2001, NetEase.com disclosed that it had discovered that $1 million in contracts had been improperly reported as revenue and as a result, it would delay announcing its financial results for the first quarter of 2001. Subsequently, on June 11, 2001, the Company announced that the revenue overstatement appeared to affect its full year 2000 financial statements and the amount of the overstatement would be approximately $3 million. Then, on August 31, 2001, NetEase.com finally revealed the full extent of the overstatement. The Company announced that it would be restating all of its year 2000 financial statements because $4.3 million in revenue had been overstated. The complaint alleges that the prospectus and registration statement issued in connection with the initial public offering of NetEase.com ADSs (the "IPO") were materially false and misleading because they contained artificially inflated financial results for the first quarter of 2000. Following the IPO, defendants issued press releases announcing the Company's quarterly 2000 and full year 2000 financial results which were materially false and misleading because they overstated NetEase.com's financial performance. The complaint was filed in the United States District Court for the Southern District of New York . The lead plaintiff motion must be filed no later than December 21, 2001.
NEXTCARD, INC. (Nasdaq:NXCD) (Class Period: 03/30/00 - 10/30/01). The complaint charges NextCard and certain of its officers and directors with issuing false and misleading statements concerning its business and financial condition. Specifically, the complaint alleges that defendants disseminated false and misleading statements concerning the Company's operations and prospects for 2000 and 2001. In fact, defendants knew NextCard's reserves were materially under-funded and that as a result, its 2000 and 2001 projections and/or results were false. During the Class Period, taking advantage of the inflation in NextCard stock, defendants Lent, Cai, Qureshey and Hashman sold almost $9 million worth of their own NextCard stock at artificially inflated prices of as much as $10.89 per share. Then, on Oct. 31, 2001, it was revealed that, among other things, defendants had concealed that during the Class Period: (a) due to the deteriorating quality of NextCard's portfolio, the Company would need to dramatically increase its reserves for loan losses in fiscal 2000 and Q1, Q2 and Q3 2001 and as a result its reported value of its loans for fiscal 2000 and Q1 and Q2 2001 was overstated; (b) the Company had improperly recorded "credit losses" as "fraud losses" and as a result the Company's "securitization activities" during the Class Period did not qualify for "low level recourse treatment". Defendants knew that as a result, such would dramatically increase the Company bank division's risk weighted assets, and would decrease the Company's "risk based capital ratio" below federal banking guidelines - rendering the Company "significantly under capitalized"; (c) because the Company's risk-based capital ratio had plummeted below acceptable levels, it had been technically subject to a Prompt Correction Action Order and thereby restricted from accepting or reviewing any broken deposits; (d) as a result of the above, the Company's 2000 and 2001 results and projections were materially false and misleading. These disclosures shocked the market, causing NextCard's stock to decline to $0.84 per share before closing at $0.87 per share on Oct. 31, 2001 on volume of more than 43 million shares, inflicting millions of dollars of damage on plaintiff and the Class. The complaint was filed in the United States District Court for the Northern District of California. The lead plaintiff motion must be filed no later than December 31, 2001.
AETNA, INC. (NYSE:AET) (Class Period: 12/13/00 - 06/07/01). The complaint charges Aetna, Inc. and certain of its officers and directors with issuing a series of material misrepresentations to the market before and during the Class Period, thereby artificially inflating the price of Aetna common stock. Specifically, the complaint alleges that Aetna issued statements concerning, among other things, the ability of Aetna to control and monitor its costs and obligations in light of the Company's expected and actual sales. Defendants knew that Aetna's management systems, procedures and controls for monitoring such costs were lacking but they made positive statements about Aetna's management, controls, and abilities to control costs while concealing the defective management systems. Between April 10, 2001 and May 8, 2001, Aetna surprised the market by announcing higher-than-anticipated medical costs during the fourth quarter of 2000 and the first quarter of 2001, faulty record-keeping which caused the payment of millions of dollars in medical claims for former clients, and the absence of necessary management control systems required for management to know Aetna's obligations and proper medical costs. Finally, on June 7, 2001, it was revealed that the cause of much of the Company's financial woes was that: "Poor record-keeping has resulted in ... paying millions of dollars in medical claims for people whose benefits have expired." During the Class Period, the value of Aetna shares had been artificially inflated to almost $43.00 per share but, as a result of these disclosures, Aetna's stock price plunged in excess of forty percent to below $25.00 per share. The complaint was filed in the United States District Court for the Southern District of New York. The lead plaintiff motion must be filed no later than January 7, 2002.
If you purchased the securities of any of the companies listed below during the respective class periods, you may be a member of the class and have until the date specified to move the court to become the lead plaintiff. For more information on a particular lawsuit and to view the complaint, you may visit our website at www.sbclasslaw.com. To learn more about your rights and interests in these cases and your ability to potentially recoup your losses, please contact Schiffrin & Barroway directly at 888-299-7706 (toll free) or 610-822-2221, fax number 610-822-0002 or by e-mail at info@sbclasslaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.
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