NEW YORK, April 9, 2002 (PRIMEZONE) -- Gemstar-TV Guide International, Inc. ("Gemstar" or the "Company") (Nasdaq:GMST) improperly recognized $107.6 million in licensing revenue from cable TV equipment maker Scientific-Atlanta, Inc. ("Scientific-Atlanta") since 1999. Although Scientific-Atlanta stopped making payments to Gemstar beginning in 1999, according to allegations in a Complaint filed by Pomerantz Haudek Block Grossman & Gross LLP (www.pomerantzlaw.com), on behalf of purchasers of the common stock of Gemstar during the period from November 10, 1999 through April 1, 2002, inclusive (the "Class Period). The case was filed in the United States District Court for the Central District of California (Western Division) (Index Number 02-02869). Defendants Gemstar and two of the Company's senior officers are charged with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
The Complaint further alleges that Gemstar improperly booked $20 million in revenue from advertising space it purportedly "sold" on its interactive program guides ("IPGs") to a company called Fantasy Sports, although the transaction was actually a "barter arrangement" in which, the Company received intellectual patents, not cash, from Fantasy Sports. Plaintiff charges that as a result of defendant's misrepresentations and omissions about Gemstar's financial results and condition, the price of the Company's shares traded at artificially inflated prices during the Class Period.
On April 1, 2002, when Gemstar filed its 10-K for the year ended December 31, 2001, it belatedly provided some disclosures of its improper revenue recognition practices. Upon this revelation, the price of the Company's shares fell as much as 37%, or $5.35, to $9.01 on volume of 51.4 million. In addition, numerous analysts lowered their ratings on the Company's stock.
If you purchased the common stock of Gemstar during the Class Period, you have until June 3, 2002, to ask the Court to appoint you as one of the lead plaintiffs for the Class. To serve as lead plaintiff, you must meet certain legal requirements. If you wish to review a copy of the Complaint, to discuss this action or have any questions, please contact Andrew G. Tolan, Esq. of the Pomerantz firm at 888-476-6529 (or (888) 4-POMLAW), toll free, or at agtolan@pomlaw.com by e-mail. 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 and Chicago, 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.
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