ATLANTA, Nov. 15, 2002 (PRIMEZONE) -- Chitwood & Harley announces that it has sued Sears, Roebuck & Co. ("Sears" or the "Company") (NYSE:S) and certain of its officers and directors in the United States District Court for the Northern District of Illinois, Eastern Division. The shareholder lawsuit is on behalf of all persons and entities who purchased Sears securities during the period January 17, 2002 through October 17, 2002, inclusive ("Class Period").
If you wish to discuss this action or have any questions concerning this notice or your rights with respect to this matter, you may contact Nikole Davenport at 1-888-873-3999 (toll-free) or by e-mail at nmd@classlaw.com. A copy of the Complaint can be viewed on our website at www.classlaw.com. If you wish to serve as lead plaintiff, you must move the Court for appointment no later than December 17, 2002. Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The Complaint alleges that Sears, Alan Lacy (CEO, President and Chairman), Glenn Richter (CFO from October 4, 2002, Senior V.P., Finance since inception of Class Period), Paul J. Liska (CFO until October 4, 2002) and Thomas E. Bergmann (Chief Accounting Officer), violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of materially false and misleading statements to the market during the Class Period. These alleged misstatements had the effect of artificially inflating the price of Sears securities.
According to the complaint, defendants, throughout the Class Period, represented that Sears was growing its earnings strongly, driven by its Credit and Financial Products segment and that it would achieve earnings growth of 22% in 2002. In addition, in each of its press releases and SEC reports filed during the Class Period, Sears reported its provisions for uncollectible accounts and in its 2001 annual report represented that such reserves were "adequate."
These, and other statements detailed in the complaint, were allegedly false and misleading because, according to the complaint, they did not disclose that the Company's risk for uncollectible accounts had increased materially throughout the Class Period and, in addition, that Sears was under-reserving for its uncollectible accounts which inflated its earnings and balance sheet. On October 17, 2002, Sears reported in a press release that it will grow its 2002 earnings by 15%, rather than the 22% it reaffirmed as recently as ten days previously, because of a "$222 million increase in the domestic provision for uncollectible accounts."
In addition, according to the press release, earnings for the third quarter were 26% less than the previous year. In reaction to the press release, the price of Sears common stock plummeted, falling 32%, from an October 16 close of $33.95 per share to close at $23.15 per share on October 17, on extremely heavy trading volume.
In order to serve as lead plaintiff, you must meet certain legal requirements which Chitwood & Harley would be happy to discuss with you. Chitwood & Harley is a class action law firm that represents victims of securities fraud and corporate mismanagement.
Chitwood & Harley has been appointed lead counsel in major actions throughout the United States and has been instrumental in recovering billions of dollars on behalf of its clients. Clients and courts alike have praised the results achieved by Chitwood & Harley. Recently, the federal judge in In re BankAmerica Securities Litigation, which resulted in a $490 million settlement, commented favorably on counsel's performance stating: "Class members were well served by experienced attorneys who, through considerable time and effort, obtained a significant recovery for their clients," and, "(a)s the Court has remarked throughout this litigation, class counsel ... have performed at exceptionally high levels, and all parties have been exceedingly well represented."
For more information about Chitwood & Harley, please visit our website at www.classlaw.com or contact Nikole Davenport at 1-888-873-3999 (toll-free), by e-mail at NMD@classlaw.com or at 1230 Peachtree Street, Suite 2300, Atlanta, Georgia 30309.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca