BALA CYNWYD, Pa., Feb. 28, 2003 (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 Western District of Missouri on behalf of all purchasers of the common stock of Interstate Bakeries Corporation (NYSE:IBC); ("IBC" or the "Company") from September 17, 2002 and December 17, 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 Interstate Bakeries Corporation 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 issued numerous statements regarding the Company's financial performance and future prospects. Specifically, defendants claimed that the Company was experiencing a rebound in the sales of its sweet cake products, which had slowed down in the previous quarter, and described how the Company would be able to increase prices for certain bread products and maintain its anticipated level of profitability in the face of increasing commodity prices.
The Complaint alleges that these statements were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (i) that since the beginning of the Class Period, the Company was actually experiencing a negative variance with respect to cake sales as compared to the prior year and, therefore, had not seen any indication of any rebound in cake sales; and (ii) the Company did not maintain sufficient centralized control over price increases to ensure that the Company could raise prices on bread products without damaging profitability; defendants knew that an increase in prices typically would result in a sacrifice in market share and the Company actually was exposed to significant risk with respect to its ability to attain profits based upon commodity prices.
On December 17, 2002, the last day of the Class Period, IBC shocked the market by reporting extremely poor second quarter earnings, which it attributed primarily to weak sales of its sweet cakes. Following this announcement, shares of IBC common stock plunged in value by over 35%, from $23.16 per share on December 16, 2002, to $15.00 per share on December 17, 2002, on extremely heavy trading volume that was almost fifty (50) times more active than normal. Prior to the disclosure of the Company's true financial condition, certain of the Individual Defendants and other IBC insiders sold shares of their personally-held common stock for gross proceeds in excess of $16 million.
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 April 21, 2003, 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.