LOS ANGELES, Calif., Aug. 30, 2002 (PRIMEZONE) -- Notice is hereby given that Glancy & Binkow LLP commenced a Class Action lawsuit in the United States District Court for the Northern District of California on behalf of a class (the "Class") consisting of all persons who purchased securities of Riverstone Networks, Inc. ("Riverstone" or the "Company") (Nasdaq:RSTN) between August 10, 2001 and June 5, 2002, inclusive (the "Class Period").
A copy of the Complaint is available from the court or from Glancy & Binkow LLP. Please contact us by phone at (310) 201-9161 or Toll Free at (888) 773-9224 or by email at info@glancylaw.com.
The Complaint charges Riverstone and certain of its officers and directors with violations of federal securities laws. Among other things, plaintiff claims that defendants' material omissions and the dissemination of materially false and misleading statements regarding the nature of Riverstone's financial condition and sales caused Riverstone's stock price to become artificially inflated, inflicting damages on investors. The Complaint alleges that defendants misled the investing community concerning the true effect that the downturn in telecom spending had upon the Company and its financial viability. On February 28, 2002, the Company shocked the market when it announced: (i) revenues for the fourth quarter ending March 2, 2002, would be approximately $50 to $54 million, instead of the projected $65 million; (ii) that the Company would reduce its expenses, including workforce reductions, by 10 percent; (iii) that it expects to take charges in the fourth quarter totaling approximately $26 million to $30 million, consisting of asset impairments, write downs in equity investments, charges related to discontinued products and costs associated with workforce reductions; and (iv) the Days Sales Outstanding, an important financial indicator showing the average time it takes customers to pay their bills, increased to 75.7 days. As a direct result, the price of Riverstone stock dropped from $7.59 to $3.82, a 49% drop from the Class Period high of $21.10. On June 5, 2002, Riverstone announced a further decline in sales of 40%. This information further depressed Riverstone common stock, which sank an additional 21%, from $3.30 per share on June 5, 2002 to $2.61 on June 6, 2002.
Plaintiff seeks to recover damages on behalf of Class members and is represented by Glancy & Binkow LLP, a law firm with significant experience in prosecuting class actions, and substantial expertise in actions involving corporate fraud.
If you are a member of the Class described above, you may move the Court, not later than September 24, 2002, to serve as lead plaintiff, however, you must meet certain legal requirements. If you wish to discuss this action or have any questions concerning this Notice or your rights or interests with respect to these matters, please contact Michael Goldberg, Esquire, of Glancy & Binkow LLP, 1801 Avenue of the Stars, Suite 311, Los Angeles, California 90067, by telephone at (310) 201-9161 or Toll Free at (888) 773-9224 or by e-mail to info@glancylaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.