NEW YORK, Oct. 12, 2005 (PRIMEZONE) -- Pomerantz Haudek Block Grossman & Gross LLP (www.pomerantzlaw.com) has filed a class action complaint in the United States District Court, Eastern District of New York, against Lipman Electronic Engineering, Ltd. ("Lipman" or the "Company") (Nasdaq:LPMA) (TASE:LPMA) and certain of its officers and directors. The class action was filed on behalf of public investors who purchased the common stock of Lipman on either or both the Nasdaq National Market and the Tel Aviv Stock Exchange during the period of October 4, 2004 through September 27, 2005, inclusive (the "Class Period").
Lipman Electronic Engineering is a corporation organized under the laws of the State of Israel and headquartered in Rosh Haayin, Israel. The Company develops, manufactures, markets and sells electronic payment systems and software worldwide.
The Complaint alleges that throughout the Class Period, Lipman issued public statements in press releases and to analysts which fraudulently created a false impression concerning the Company's business operations and prospects following the acquisition of Dione, Plc ("Dione"), a United Kingdom-based supplier of so-called "smart card" payment systems. Defendants claimed that the Dione acquisition would add to Lipman's earnings within one year and "provide important new customer relationships that would add critical mass to our U.K. presences" when, in fact, at the time of these statements, defendants knew or recklessly disregarded the substantial difficulty the Company was facing in integrating and exploiting the Dione acquisition.
Less than one year after completing the Dione acquisition, the misleading nature of defendants' Class Period statements was revealed on September 28, 2005, in a stunning admission by the Company that the "weaker than expected performance of Dione" caused the Company to slash its 2005 earnings estimates, from a previous forecast of $1.39 to $1.42 per share down to $0.88 to $0.98 per share. The Company also announced that it had terminated the employment of Dione CEO Shaun Gray and that the Company anticipated it would take a non-cash impairment charge relating to goodwill and other intangible assets in 2005. Investor reaction was sharply negative to the news of the Dione unit's shockingly poor performance causing Lipman's share price to plunge nearly 22 percent following the disclosure of the Company's inability to leverage the Dione acquisition to expand Lipman's European market presence. Additionally during the Class Period, defendants materially misleading statements and omissions enabled the Company to complete a secondary offering of 1,973,044 shares at $29.75 per share in May 2005.
If you purchased the securities of Lipman during the Class Period, you have until December 12, 2005 to ask the Court to appoint you as lead plaintiff for the Class. Lead plaintiffs must meet certain legal requirements. Shareholders outside the United States may also join the action, regardless of where they live or which exchange was used to purchase the securities. If you wish to review a copy of the Complaint, to discuss this action, or have any questions, please contact Teresa L. Webb (tlwebb@pomlaw.com) or Carolyn S. Moskowitz (csmoskowitz@pomlaw.com) of the Pomerantz Firm at (888) 476-6529 (or 888-4-POMLAW), toll free. Those who inquire by e-mail are encouraged to include their mailing address and telephone number.
The Pomerantz Firm, which has offices in New York, Chicago and Washington, D.C., is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 50 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members.
More information on this and other class actions can be found on theClass Action Newsline at www.primezone.com/ca