LITTLE ROCK, Ark., April 26, 2002 (PRIMEZONE) -- The Emerson Firm, a securities class action trial law firm, announced today that a class action has been filed in the United States District Court for the Northern District of California on behalf of purchasers of Calpine Corporation (NYSE:CPN) ("Calpine" or the "Company") common stock during the period between January 5, 2001 and December 13, 2001, inclusive (the "Class Period"). A copy of the complaint filed in this action is available from the Court, or can be obtained from the Firm.
The complaint charges Calpine and certain of its officers and directors with issuing false and misleading statements concerning its business and financial condition. Calpine 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 bought Calpine common stock between January 5, 2001 and December 13, 2001 inclusive, and you wish to serve as lead plaintiff, you must move the Court no later than May 13, 2002. If you are a member of this class, you can join this class action by contacting The Emerson Firm. Any member of the purported class may move the Court to serve as lead plaintiff through The Emerson Firm or other counsel of their choice, or may choose to do nothing and remain an absent class member.
The Emerson Firm has substantial experience representing investors in securities fraud class action lawsuits such as this. In fact, the Firm was recently appointed by a Court in Houston to the Plaintiffs' Counsel Steering Committee prosecuting the Enron retirement plan litigation. The firm has offices in Houston, Texas and Little Rock, Arkansas, 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.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.