NEW YORK, June 19, 2002 (PRIMEZONE) -- Please take notice that the law firm of Kirby McInerney & Squire, LLP has commenced a class action lawsuit in the United States District Court for the Southern District of Texas on behalf all persons who purchased the common stock of Reliant Resources Inc. (NYSE:RRI) in the period between April 30, 2001 and May 13, 2002 (the "class period"), including those persons who purchased shares in the initial public offering of Reliant common stock (the "Reliant IPO").
A copy of the complaint is available from the Court or from Kirby McInerney & Squire. Please visit our website, which offers summary and detailed information concerning the case at www.kmslaw.com/new_cases/reliant/reliant.htm, or contact us by phone at (888) 529-4787 or by email at obraun@kmslaw.com.
The action charges Reliant Resources Inc. ("Reliant"), Reliant's auditor Deloitte & Touche LLP, the underwriters of Reliant's IPO, and Reliant's chief executive officer, chief financial officer, and chief accounting officer, with violations of Sections 11, 12(2) and 15 of the Securities Act of 1933 and with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The violations, as the complaint alleges, stem from the materially false and misleading statements made by the defendants during the class period that, as detailed below: (i) misrepresented Reliant's business, operations and financial performance; and (ii) caused Reliant's stock to trade at artificially-inflated prices.
The complaint alleges that, during the class period, Reliant inflated its publicly reported revenues through sham "round-trip" energy trading in which Reliant purchased and sold the exact same amount of energy at the exact same price. The complaint alleges, and Reliant's chief executive officer has admitted, that there is "no apparent reason for doing these transactions other than to enhance volume" and revenue. As the complaint alleges, Reliant has admitted that such "round-trip" trading inflated its publicly reported revenues by approximately 10% during 1999, 2000 and 2001, and inflated Reliant's trading volume by as much as 25% during this period. The complaint alleges that the inflated and publicly reported revenue and trading figures misrepresented Reliant's real revenues, growth rate, and market share and acceptance. As a result, the complaint alleges, Reliant's shares traded at inflated prices based on such publicly reported, but misleading, figures; and investors who purchased Reliant shares at such inflated prices were damaged thereby. When Reliant admitted the existence and extent of such round-trip trading, Reliant's shares lost approximately 40% of the their value, falling from $14.49 per share on May 9, 2002 to close trading on May 14, 2000 at $8.70 per share. The action seeks to recover losses suffered by individual and institutional investors who purchased Reliant stock during the class period.
Plaintiffs are represented by Kirby McInerney & Squire, LLP, which specializes in complex litigation, including securities class actions. The firm has repeatedly demonstrated its expertise in this field, and has been recognized by various courts which have appointed the firm to major positions in consolidated and multi-district litigation. The firm's efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling hundreds of millions of dollars, and its achievements and quality of service have been chronicled in numerous published decisions. More information about the firm, class actions in general or about the role of the lead plaintiff in a securities class action can be obtained through Kirby McInerney & Squire's website at www.kmslaw.com.
If you are a member of the class described above, you may, no later than July 15, 2002, move the Court to serve as lead plaintiff of the class, if you so choose, pursuant to the Private Securities Litigation Reform Act of 1995 (the "PSLRA"), 15 U.S.C. section 78u-4(a). A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to seek appointment as a lead plaintiff. For more information about the case, its claims, and your rights, please contact:
Ira M. Press, Esq.
Orie Braun
KIRBY McINERNEY & SQUIRE, LLP
830 Third Avenue, 10th Floor
New York, New York 10022
Telephone: (212) 317-2300
or Toll Free (888) 529-4787
E-Mail: obraun@kmslaw.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca