CHICAGO, March 30, 2004 (PRIMEZONE) -- Much Shelist Freed Denenberg Ament & Rubenstein, P.C. announces that it has sued ITT Educational Services, Inc. (NYSE:ESI) ("ITT/ESI" or the "Company") and certain of its officers and directors, in the United States District Court for the Southern District of Indiana. The shareholder lawsuit is on behalf of all persons and entities who purchased the securities of ITT/ESI between October 17, 2002 and March 9, 2004, inclusive (the "Class Period").
The Complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market during the Class Period, thereby artificially inflating the price of ITT/ESI securities.
If you wish to discuss your rights and interests, or if you have information relevant to the lawsuit, you may contact Carol V. Gilden or Conor R. Crowley at Much Shelist Freed Denenberg Ament & Rubenstein, P.C., by calling a toll-free number 1-800-470-6824, or by sending an e-mail to investorhelp@muchshelist.com. The subject of your e-mail should be "ITT/ESI."
Specifically, the Complaint alleges that defendants issued statements touting ITT/ESI's strong financial performance and consistent growth in revenue, earnings and student enrollment. In its filings with the Securities and Exchange Commission ("SEC") throughout the Class Period, the Company disclosed that a substantial portion of the tuition paid by its students comes from federal education aid programs, which ITT/ESI's schools are authorized to offer. However, the Complaint alleges that these statements were materially false and misleading because they failed to disclose that (1) ITT/ESI falsified statistics provided to the federal government, including placement figures and rates; (2) ITT/ESI derived a material portion of its revenue from federal grants and financial aid payments secured through falsified records submitted to the federal government; (3) defendants' actions could result in disqualification of ITT/ESI's students from future participation in federal education aid programs; and, (4) as a result, defendants' positive statements concerning the Company's future prospects were lacking a reasonable basis when made.
On February 25, 2004, ITT/ESI shocked the market when it announced that federal agents had raided the Company's corporate headquarters in Indianapolis. The agents were executing search warrants issued pursuant to a grand jury probe by the Southern District of Texas. According to the Company, the search warrants sought records concerning student placement, retention, graduation, attendance, recruitment, grades, graduates' salaries and transfers of students' credits to other institutions. As a result of the announcement, the price of the Company's stock plummeted $18.90 to $38.50 per share, or a fall of approximately 33%.
If you purchased ITT securities during the Class Period and if you meet certain other legal requirements, you may file a motion in the Court where the lawsuit has been filed to serve as a lead plaintiff. You must file your motion no later than April 26, 2004.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. 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 serve as a lead plaintiff. The requirements for serving as a lead plaintiff are set forth in the Private Securities Litigation Reform Act of 1995 (15 U.S.C. Section 78u-4).
Much Shelist's history is one of experience, leadership and results. For more than 25 years, Much Shelist has represented plaintiffs in class action litigation in federal and state courts across the United States. The firm has successfully prosecuted cases involving securities fraud, antitrust violations, consumer fraud, unlawful business practices and insurance company fraud. Under Much Shelist's leadership, class members have obtained judgments and settlements in excess of $4 billion.