BALA CYNWYD, Pa., April 11, 2002 (PRIMEZONE) -- The following statement was issued today by the law firm of Schiffrin & Barroway, LLP: A securities class action lawsuit pending in the U.S. District Court for the Northern District of California ( C-02-1368) claims that Calpine Corporation ("Calpine" or the "Company") (NYSE:CPN) misled shareholders about its business and financial condition.
Plaintiff seeks damages for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of all investors who bought Calpine Corporation securities between January 5, 2001 through December 13, 2001(the "Class Period").
Schiffrin & Barroway, LLP has prosecuted shareholder class actions for over fourteen years and has recovered more than $1 billion for investors. If you are a shareholder of Calpine Corporation and want to learn more about this lawsuit and about becoming a lead plaintiff, you may visit our Website at http://www.sbclasslaw.com/cgi/signup.cgi.
The complaint alleges that the California-based Calpine Corporation owns, develops, acquires, and operates power-generation facilities and sells electricity and steam, primarily in the U.S. Calpine's stock, which went public in 1996, on a split adjusted basis, went from $2 at the IPO stage to over $33 in January 2001. The complaint alleges that the Company's stock price was very important because Calpine was planning at this time to build or acquire $15 billion of plants over the next four years. The financing for these plants was based on the performance of its stock because many of its bond buyers were looking to convert to common stock. If the stock did not perform, financing would be difficult to fund the Company's expansion. However, certain of Calpine's manipulative transactions, including those with Enron, such as inflated revenues, began to emerge on December 9, 2001.
On December 14, 2001, prior to the market opening, Moody's Investors Service announced that it might cut the credit rating on Calpine's $11.6 billion of debt to junk. In response, Calpine's shares plummeted to $12.50, a more than 26% drop. Then, after the close of the market on December 14, 2001, Moody's Investors Service announced that it had in fact cut its rating of Calpine's debt to junk.
As now revealed, at all times during the Class Period, defendants issued false and misleading statements and press releases concerning the Company's sale of and demand for power and the Company's ability to generate sufficient cash revenue to service its debt. During the Class Period, before the disclosure of the true facts, the Individual Defendants sold their personally held Calpine common stock generating more than $34 million in proceeds and the Company raised billions of dollars in a series of debt offerings.
If you purchased Calpine Corporation securities between January 5, 2001 and December 13, 2001, you may be a member of the class and have until May 11, 2002 to move the court to become a lead plaintiff. In order to serve as lead plaintiff, however, you must meet certain legal requirements. To be a member of the class, however, you do not need to take any action at this time. Should you decide to seek appointment as a lead plaintiff, you may retain Schiffrin & Barroway, or retain counsel of your choice.
To learn more about your rights and interests in this case and your ability to potentially recoup your losses, please contact Schiffrin & Barroway (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) directly at 888-299-7706 (toll free) or 610-822-2221, fax number 610-822-0002, e-mail at info@sbclasslaw.com or visit our website at www.sbclasslaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca