HARTFORD, Conn., Sept. 9, 2005 (PRIMEZONE) -- The law firm of Schatz & Nobel, P.C., which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the District of Minnesota on behalf of all persons who purchased the securities of Hutchinson Technology, Inc. (Nasdaq:HTCH) ("Hutchinson" or the "Company") between October 4, 2004 and August 29, 2005 (the "Class Period").
The Complaint alleges that Hutchinson violated federal securities laws. Specifically, Hutchinson made positive statements concerning its history of beating guidance issued by the defendants and its success in manufacturing and marketing its products. Defendants' statements were materially false and misleading because defendants overstated the demand for Hutchinson's products, defendants failed to disclose that a shift in the mix of products toward new, low-yielding products was negatively impacting the Company's business and prospects, and defendants failed to disclose that they had not implemented an adequate system of internal controls. As a result of the foregoing, defendants' statements that Hutchinson was operating according to plan, and their guidance lacked any reasonable basis in fact. While, the price of Hutchinson common stock was artificially inflated, defendants sold their personally-held shares of Hutchinson stock for more than $12.1 million in proceeds.
On August 30, 2005, Hutchinson issued a press release announcing lowered guidance for the fourth quarter 2005. The Company stated that earnings would be $0.05 per share, compared to previous guidance of $0.65, and that the Company's gross margins would fall as low as 19%, significantly lower than the Company's previous estimate of as high as 30%. On this news, Hutchinson stock fell $5.35 per share, or 17%, from its closing price of $31.51 on August 29, 2005, to $26.16 on August 30, 2005.
If you are a member of the class, you may, no later than November 8, 2005, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members, including decisions concerning settlement. The securities laws require the Court to consider the class member(s) with the largest financial interest as presumptively the most adequate lead plaintiff(s).
While Schatz & Nobel has not filed a lawsuit against the defendants, to view a copy of the Complaint initiating the class action or for more information about the case, class action cases in general, and your rights, please contact Schatz & Nobel toll-free at (800) 797-5499, or by e-mail at sn06106@aol.com, or visit our website: www.snlaw.net.