NEW YORK, June 25, 2004 (PRIMEZONE) -- Wechsler Harwood LLP today announced that it has filed a Federal Securities fraud class action on behalf of persons or entities who purchased or otherwise acquired the securities of BEA Systems, Inc. (Nasdaq:BEAS; "BEA" or the "Company") between November 13, 2003 and May 13, 2004, both dates inclusive (the "Class Period").
The action, entitled Stroh v. BEA Systems, Inc., et al., Case No. 04-CV-2562 (SC), is pending in the United States District Court for the Northern District of California as defendants, the company, its Chairman, President and Chief Executive Officer, Alfred S. Chuang, its Executive Vice President of Worldwide Sales, Charles L. Ill, III, and its President of Worldwide Services, Thomas M. Ashburn. A copy of the complaint can be obtained from the Court or can be viewed on Wechsler Harwood web site at: www.whesq.com.
The complaint charges defendants with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. More specifically, the complaint alleges that, throughout the Class Period, defendants issued materially false and misleading statements to the investing public regarding BEA's business and prospects. As a result of these false statements, BEA's stock price traded at inflated levels during the Class Period, increasing to as high as $14 in early 2004, whereby the Company's top officers and directors sold more than $13 million worth of their own shares. Then on May 13, 2004, BEA reported disappointing first quarter results, citing the difficult selling environment and sales execution issues as the primary reasons. On this news, the Company's shares fell 30% to $8 per share.
According to the complaint, the true facts, which were known to the defendants but actively concealed from the public, were as follows: (i) that the Company was experiencing material sales execution problems in its licensing division, resulting in license reserve being down in the comparable quarter and in the sequential quarter; (ii) that during the preceding quarter, the Company's sales staff and management were attempting to reorganize; however, in doing so, the Company's sales were actually disrupted; (iii) that the Company's WebLogic 8.1 Platform was far from "revolutionary" and was not selling as defendants claimed; (iv) that the coverage of small and medium-sized businesses was transferred to the General Accounts Team, which disrupted the Company's North American reserves; and (v) that the Company was experiencing weakness in its telecom vertical business, not strength.
If you purchased or otherwise acquired BEA securities during the Class Period, you may request that the Court appoint you as lead plaintiff by August 9, 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. You may retain Wechsler Harwood, or other counsel of your choice, to serve as your counsel in this action.
Wechsler Harwood has taken a leading role in many important actions on behalf of defrauded shareholders. The Wechsler Harwood website (www.whesq.com) has more information about the firm and detailed information regarding this matter. If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following:
Wechsler Harwood LLP 488 Madison Avenue, 8th Floor New York, New York 10022 Toll Free Telephone: (877) 935-7400
Craig Lowther, Wechsler Harwood Shareholder Relations Department: clowther@whesq.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.