PHILADELPHIA, Aug. 23, 2005 (PRIMEZONE) -- Law Offices Bernard M. Gross, P.C. (http://www.bernardmgross.com) announces that a class action lawsuit, numbered 05-4414, was commenced in the United States District Court for the Eastern District of Pennsylvania before the Honorable Thomas N. O'Neill, Jr. against defendants ATI Technologies, Inc. (Nasdaq:ATYT), Kwok Yuen Ho, Chairman of the Board of ATI; David E. Orton, President and Chief Executive Officer; and Patrick G. Crowley, Chief Financial Officer and Senior Vice President-Finance, on behalf of all persons who purchased the securities of ATI Technologies, Inc.(Nasdaq:ATYT) between October 7, 2004 and June 23, 2005.
The complaint charges ATI Technologies, Kwok Yuen Ho, David E. Orton and Patrick G. Crowley with violations of the Securities Exchange Act of 1934. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts: (a) the Company was selling desktop and notebook products with lower and lower profit margins; (b) ATI's gross margins were being weakened by high sales of its IGP (integrated graphics processor) products, which have profit margins well below the corporate average; (c) the Company was earning lower-than-anticipated yields on certain products due to operational issues in its own packaging and test areas of its manufacturing process; (d) the Company was experiencing production/design/yield issues with its R520 chip, the release of which was six months behind schedule; (e) the Company was losing market share to arch-rivals Nvidia Corp. and Intel Corp. causing downward pressure on ATI's prices; (f) ATI lost market share to Nvidia in the enthusiast and mainstream markets following the launch of Nvidia's SLI (scalable link interface) chipset in early 2005. The SLI chipset enables the use of two graphics cards instead of one in a desktop computer, allowing desktop users to upgrade graphics at cheaper prices, a product ATI will not have on the market until early August 2005; (g) ATI lost market share to Intel in the notebook computer market, traditionally an area of strength for ATI, because as would later be revealed, Intel's Alviso chipset offers "more than-adequate" graphics performance for many notebook computer users; and (h) despite defendants' previous statements to the contrary, a fire at one of the Company's primary suppliers in Taiwan was preventing the Company from receiving necessary supplies.
As a result of defendants' false and misleading Class Period statements and omissions, ATI's stock traded at inflated levels, increasing to as high as $20.66 per share on December 3, 2004, allowing the Company's top officers and directors to sell or otherwise dispose of more than $54 million worth of their own shares during November and December 2004 at inflated prices of between $18 and $20 per share. However, after the true status of the Company's business performance and financial status were unveiled in June 2005, the Company's shares plummeted, erasing over $2.2 billion in market capitalization.
If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, Deborah R. Gross or Susan R. Gross of Law Offices Bernard M. Gross at 866-561-3600(toll-free) or via e-mail at susang@bernardmgross.com. If you are a member of this class, you can view a copy of the complaint as filed at http://www.bernardmgross.com. 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.
If you purchased or otherwise acquired the securities of ATI Technologies, Inc. between October 7, 2004 and June 23, 2005 ("Class Period"), and sustained damages, you may, no later than October 17, 2005, file a motion to be appointed lead plaintiff, if you so choose. Law Offices Bernard M. Gross, P.C. has significant experience and expertise in prosecuting class actions.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca