MILWAUKEE, June 25, 2004 (PRIMEZONE) -- Ademi & O'Reilly, LLP (http://www.ademilaw.com/cases/Bally.php) announced that we have filed a class action suit in the United States District Court for the Northern District of Illinois, Eastern Division on behalf of purchasers of Bally Total Fitness Holding Corporation ("Bally") (NYSE:BFT) securities during the period between August 3, 1999 and April 28, 2004 (the "Class Period").
If you wish to serve as lead plaintiff, you must move the Court no later than July 26, 2004. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Guri Ademi at 866-264-3995 or via e-mail at gademi@ademilaw.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.ademilaw.com/cases/Bally.php. Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint alleges that throughout the Class Period defendants issued numerous positive statements and filed quarterly and annual reports with the SEC which described the Company's increasing financial performance. These statements were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (i) that the Company had violated Generally Accepted Accounting Principles ("GAAP") and its own internal policies by prematurely recognizing revenue on certain non-obligatory prepaid membership dues; (ii) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (iii) that, as a result, the value of the Company's reported revenues during the Class Period was materially overstated.
On April 28, 2004, the Company issued a press release announcing that its Chief Financial Officer and Director, John W. Dwyer, had resigned and that the Division of Enforcement of the SEC had commenced an investigation in connection with the Company's announced restatement regarding the timing of recognition of certain prepaid dues. The Company also stated that it had modified its existing internal controls structure, which it believes is now effective.
In response to these disclosures, shares of the Company's stock fell approximately 17%, to close at $4.50 per share, on extremely heavy trading volume.