BALA CYNWYD, Pa., July 28, 2004 (PRIMEZONE) -- The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:
Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Eastern District of Louisiana on behalf of all securities purchasers of The Shaw Group, Inc. (NYSE:SGR) ("Shaw" or the "Company") from October 19, 2000 through June 10, 2004, inclusive (the "Class Period").
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Schiffrin & Barroway, LLP (Marc A. Topaz, Esq. or Darren J. Check, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com.
The complaint charges that Shaw, Tim Barfield, Jr., J.M. Bernhard, Jr., Richard F. Gill, and Robert Belk, 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 material misrepresentations to the market between October 19, 2003 and June 10, 2004, about the Company's financial condition thereby artificially inflating the price of Shaw's shares. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company's earnings were materially lagging; (2) that because the Company's earnings were lagging, the Company's creation of $83.7 million reserve for contracts acquired from Stone & Webster and adjusted for fair market value, was solely done as a means for the defendants to manipulate the Company's margins and report positive financial results; (3) that the Company's practice of cannibalizing the reserves, created to adjust newly acquired contracts to fair value, had substantially depleted the gross margin reserves and resulted in an eventual earnings decline; (4) that as a consequence of this, the Company improperly recorded revenue and earnings in violation of its purported revenue recognition policy and General Accepted Accounting Principles ("GAAP"); and (5) that as a result of the above, the Company's financial results were materially inflated at all relevant times.
On June 10, 2004, Shaw disclosed that the Company was notified by the SEC on June 1, 2004, that the SEC was conducting an informal inquiry of Shaw. The SEC investigation focused on the Company's purchase method of accounting for acquisitions. The news shocked the market. Shares of Shaw fell $1.53 or 12.4 percent on June 11, 2004, to close at $10.75.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin & Barroway, which prosecutes class actions in both state and federal courts throughout the country. Schiffrin & Barroway is a driving force behind corporate governance reform, and has recovered in excess of a billion dollars on behalf of institutional and high net worth individual investors. For more information about Schiffrin & Barroway, or to sign up to participate in this action online, please visit http://www.sbclasslaw.com.
If you are a member of the class described above, you may, not later than August 16, 2004 move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Schiffrin & Barroway, or other counsel of your choice, to serve as your counsel in this action.