BALA CYNWYD, Pa., April 5, 2002 (PRIMEZONE) -- A pending class action charges Advanced Switching Communications, Inc. ("Advanced Switching" or the "Company") (Nasdaq:ASCX) with misleading investors about its business and financial condition according to the law firm of Schiffrin & Barroway, LLP.
The complaint was filed in the U.S. District Court for the Eastern District of Virginia (02-306-A). Plaintiff seeks damages for violations of the federal securities laws on behalf of all investors who purchased Advanced Switching Communications, Inc. securities between October 5, 2000 through February 12, 2002 (the "Class Period").
Schiffrin & Barroway, LLP has prosecuted shareholder class actions for over fourteen years and has recovered more than $1 billion for investors. If you are a shareholder of Advanced Switching Communications, Inc. and want to learn more about this lawsuit and about becoming a lead plaintiff, you may visit our website at http://www.sbclasslaw.com/cgi/signup.cgi.
The complaint alleges that the Virginia-based Advanced Switching Communications, Inc. violated Sections 11 and 15 of the Securities Act of 1933 by issuing a materially false and misleading Prospectus and Registration Statement ("Prospectus") in connection with the Company's initial public offering ("IPO"), and 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 between October 5, 2000 and February 12, 2002, thereby artificially inflating the price of Advanced Switching securities. On October 5, 2000, Advanced Switching completed its IPO pursuant to a Prospectus in which it represented that it had signed a $24 million contract with Qwest Communications, Inc. ("Qwest"), that it's a-4000 product was being shipped and that it's a-4500 product would be available in 2001.
In fact, as alleged in the complaint, at the time of the IPO, the Prospectus concealed that Advanced Switching's largest customer was having significant problems with Advanced Switching products, another significant customer had informed the Company it was over-inventoried and that the agreement with Qwest was contingent on Advanced Switching complying with terms the Company could not complete. Moreover, the Company had not even started on the A-4500 such that it was impossible that this product would be available in 2001. Later, subsequent to the IPO, defendants issued statements which asserted that customers were deploying the A-4000, which, as alleged in the complaint, did not occur, and that Advanced Switching offered DS-O to OC-192 capability which, in fact, the Company had not been able to offer.
On February 5, 2001, the Company issued a press release announcing that it would be liquidated, which as alleged in the complaint, was essentially an admission that it had been a complete failure as a public company because the A-4500 had not been made available in 2001 and the Qwest contract had failed due to Advanced Switching's inability to meet the terms of the contract. Finally, on February 12, 2002, the Company announced that a major customer had asked for a $17 million refund due to a defective product being shipped.
If you purchased Advanced Switching Communications, Inc. securities between October 5, 2000 through February 12, 2002, you may be a member of the class and have until April 22, 2002 to move the court to become a lead plaintiff. In order to serve as lead plaintiff, however, you must meet certain legal requirements. To be a member of the class, however, you do not need to take any action at this time. Should you decide to seek appointment as a lead plaintiff, you may retain Schiffrin & Barroway, or retain counsel of your choice.
To learn more about your rights and interests in this case and your ability to potentially recoup your losses, please contact Schiffrin & Barroway (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) directly at 888-299-7706 (toll free) or 610-822-2221, fax number 610-822-0002, e-mail at info@sbclasslaw.com or visit our website at www.sbclasslaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca