BALA CYNWYD, Pa., Sept. 30, 2002 (PRIMEZONE) -- The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:
Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Eastern District of Texas on behalf of all purchasers of the common stock of Electronic Data Systems Corp. (NYSE:EDS) between September 7, 1999 and September 24, 2002, inclusive (the "Class Period").
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 Schiffrin & Barroway, LLP (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com.
The complaint charges Electronic Data Systems Corp. and certain of its officers and directors with issuing false and misleading statements concerning its business and financial condition. Specifically, the complaint alleges that defendants made misstatements of material facts and omitted to state material facts in their public statements and elsewhere, including failing to disclose that EDS's backbone revenue from its Information Solutions IT outsourcing business is highly susceptible to interruption due to terms in EDS's service contracts that enable EDS customers to unilaterally suspend discretionary spending on IT outsourcing, affirmatively misrepresenting the predictability of EDS's future cash flows by touting the anticipated revenue that EDS would supposedly receive from its IT outsourcing service contracts with customers without disclosing that payments under such contracts were not guaranteed, and failing to disclose that EDS faced significant potential threats to its liquidity if its share price fell because of put-option and other obligations that ultimately obligated EDS to in effect buy back a total of 5.44 million shares of EDS stock at fixed prices averaging over $60.00 per share.
The complaint alleges that after Wall Street began to learn about the foregoing on September 18, 2002 after executives of EDS warned that a lack of new revenues would wipe out more than $0.60 per share of its Q3 earnings target of $0.74, the price of EDS stock plummeted to a 52-week low of $20, down from a class period high of $72.45. The complaint alleges that after further revelations regarding EDS's put-option and other liabilities emerged in the wake of the foregoing disclosures, EDS's share price tumbled even further, reaching an intra day low of $10.09 on September 24, 2002.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin & Barroway, LLP, which prosecutes class actions on behalf of investors and shareholders. For more information on Schiffrin & Barroway, or to sign-up to participate in this action online, please visit http://www.sbclasslaw.com/cgi/signup.cgi.
If you are a member of the class described above, you may, not later than November 25, 2002, move the Court to serve as lead plaintiff of the class, if you so choose. In order to serve as lead plaintiff, however, you must meet certain legal requirements.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca