NEW YORK, March 31, 2006 (PRIMEZONE) -- Murray, Frank & Sailer LLP has filed a class action lawsuit in the United States District Court for the Southern District of New York on behalf of all securities purchasers of The Estee Lauder Companies, Inc. (NYSE:EL) ("Estee Lauder" or the "Company") between April 28, 2005 and October 25, 2005, inclusive (the "Class Period").
Estee Lauder is a global manufacturer of skin care, makeup, fragrance, and hair care products. The complaint alleges that, at the commencement of the Class Period, the Company's market share was decreasing and that, rather than reverse this negative trend, or fully disclose it, defendants launched a largely successful campaign that employed channel stuffing and the dissemination of materially false and misleading statements to prop up reported revenues and earnings, and the Company's share price, long enough for Estee Lauder insiders to sell millions of their personally held Estee Lauder shares to unsuspecting investors at prices that were artificially inflated by defendants' false and misleading statements.
The truth began to emerge on September 19, 2005 when defendants disclosed that the Company would not meet its guidance for the first half of fiscal 2006. On this disclosure, the Company's stock fell 9%, from $40.51 to $36.05 per share. The stock, however, continued to trade at artificially inflated levels until October 26, 2005 when defendants were forced to disclose that, for the first quarter of fiscal 2006, the Company would earn only $61.8 million, or $0.28 per share, down 38% from the previous year's earnings of $95.7 million, or $0.41 per share, on essentially flat sales. These results were well below analysts' revised consensus earnings estimate of $0.32 cents a share on revenue of $1.54 billion. Following this disclosure of the Company's results and lowered guidance, the Company's share price fell to $30.71. By this time, Estee Lauder insiders had, during the Class Period, sold 3,380,399 shares of their Estee Lauder common stock to unwitting investors for proceeds of $88,077,150.
Murray, Frank & Sailer LLP and its predecessor firms have devoted its practice to shareholder class actions and complex commercial litigation for more than thirty years and have recovered hundreds of millions of dollars for shareholders in class actions throughout the United States.
If you purchased or otherwise acquired Estee Lauder securities on any world exchange between April 28, 2005 and October 25, 2005 and sustained damages, you may, no later than May 29, 2006, move the Court to serve as lead plaintiff. Shareholders outside the United States may also join the action, regardless of which exchange was used to purchase the securities. To serve as lead plaintiff, however, you must meet certain legal requirements. You can join this class action as lead plaintiff online at http://www.murrayfrank.com/CM/NewCases/NewCases.asp. If you would like to discuss this action, this announcement, or your rights and interests, please contact plaintiff's counsel Eric J. Belfi or Bradley P. Dyer of Murray, Frank & Sailer LLP.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.