NEW YORK, March 11, 2005 (PRIMEZONE) -- Abbey Gardy, LLP commenced a Class Action lawsuit in the United States District Court of Michigan on behalf of a class (the "Class") of all persons who purchased or acquired securities of Delphi Corporation ("Delphi" or the "Company") (NYSE:DPH) between January 17, 2001 and March 3, 2005 inclusive (the "Class Period").
The Complaint alleges that defendants 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 during the Class Period thereby artificially inflating the price of Delphi securities. The Complaint names as defendants Delphi, J.T. Battenberg III and Alan S. Dawes. The complaint alleges that during the proposed Class Period defendants issued a series of materially false and misleading statements about the Company's financial results that caused Delphi's shares to trade at artificially inflated levels.
On October 18, 2004 (the "October 8-K"), Delphi announced that the Audit Committee of the Company's Board of Directors was conducting an internal review into the accounting treatment accorded to certain transactions with suppliers, including those for information technology services. On march 4, 2005, Delphi announced that as a result of the internal investigation, certain prior transactions involving the receipt of rebates, credits or other lump-sum payments from suppliers ("rebate transactions") and off-balance sheet financing of certain indirect materials and inventory were accounted for improperly. The Company stated it would restate results after finding accounting errors from 1999 to 2004. Delphi stated that it overstated cash flow from operations by $200 million in 2000 because of errors in off-balance sheet financing and overstated pretax income by $61 million in 2001 because of improper accounting for rebates. As a result, financial statements from 2001 on cannot be relied upon. Delphi had not yet determined which prior results will have to be restated, but it expects to complete the changes by June 30. Delphi also announced that "Vice Chairman and Chief Financial Officer, Alan S. Dawes, is leaving the company and has resigned from its Board of Directors and its strategy board. Additionally, the Company stated: "Mr. Dawes agreed to resign after the audit committee expressed a loss of confidence in him (.)"
On this news, shares of Delphi dropped from $6.37 on March 3, 2005 to $5.46 on March 4, 2005.
Plaintiff seeks to recover damages on behalf of all those who purchased or otherwise acquired Delphi securities during the Class Period. If you purchased or otherwise acquired Delphi securities during the Class Period, and either lost money on the transaction or still hold the securities, you may wish to join in the action to serve as lead plaintiff. If you purchased Delphi securities during the Class Period, you may, no later than May 6, 2005 request that the Court appoint you as lead plaintiff.
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 plaintiffs." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff.
Abbey Gardy, LLP has been retained as one of the law firms to represent the Class. The attorneys at Abbey Gardy, LLP have extensive experience in securities class action cases, and have played lead roles in major cases resulting in the recovery of hundreds of millions of dollars to investors. If you would like to discuss this action or if you have any questions concerning this Notice or your rights as a potential class member or lead plaintiff, you may contact:
Susan Lee or Nancy Kaboolian, Esq. Abbey Gardy, LLP 212 East 39th Street New York, New York 10016 (212) 889-3700 (800) 889-3701 (Toll Free) Or e-mail Susan Lee at slee@abbeygardy.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.