COLCHESTER, Conn., March 8, 2007 (PRIME NEWSWIRE) -- Today, Scott+Scott, LLP, filed a class action against Powerwave Technologies Inc. ("Powerwave" or the "Company") (Nasdaq:PWAV) and certain officers and directors in the U.S. District Court for the Central District of California. The action is on behalf of Powerwave common stock purchasers during the period May 2, 2005 through October 9, 2006, inclusive (the "Class Period"), for violations of the Securities Exchange Act of 1934. The complaint alleges that defendants made false and misleading statements and material omissions regarding the Company's business and operations and that, as a result, the price of the Company's securities was inflated during the Class Period, thereby harming investors.
If you purchased Powerwave stock during the Class Period and wish to serve as a lead plaintiff in the action, you must move the Court no later than April 2, 2007. Any member of the investor class may move the Court to serve as lead plaintiff through counsel of its choice, or may choose to do nothing and remain an absent class member. If you wish to discuss this action or have questions concerning this notice or your rights, please contact Scott+Scott (scottlaw@scott-scott.com, 800/404-7770, 860/537-5537) or visit the Scott+Scott website, www.scott-scott.com, for more information. There is no cost or fee to you.
According to the complaint, during the Class Period, defendants participated in an illicit scheme to artificially inflate the value of Powerwave stock, based on false and misleading representations of the Company's true business prospects. Plaintiff alleges that defendants were aware or consciously and recklessly disregarded the fact that the wayward execution of their acquisition and business integration strategies, in combination with the Company's flawed and defective processes and system, would likely result in lackluster revenue growth, and that, in order to falsely portray positive business prospects, defendants resorted to the manipulation of its key accounting practices, in violation of generally accepted accounting practices ("GAAP"), serving to actively conceal otherwise unexpected and disturbingly high business integration costs.
The complaint alleges that defendants' active concealment of these facts served to artificially inflate the price of Powerwave stock, allowing Company insiders to sell Powerwave stock for improper insider trading proceeds and also allowed the Company to pursue an alleged wayward acquisition strategy, if only for the purpose of convincing investors of defendants' purportedly promising growth strategy.
Defendants' conduct was revealed on October 9, 2006, when the investment community learned that the "one-time" occurrences of problems due to "seasonality" and other factors were linked to deeply entrenched problems with the Company's alleged wayward internal controls and practices. As a result of defendants' shocking announcement, on October 9, 2006, the next trading day, Powerwave's stock price tumbled $0.98 or 12.5%, closing at $6.42 per share, on extraordinarily heavy volume of 18.3 million shares.
The plaintiff is represented by Scott+Scott, a firm with significant experience in prosecuting investor class actions. The firm dedicates itself to client communication and satisfaction and currently is litigating major securities, antitrust and employee retirement plan actions throughout the United States. The firm represents pension funds, charities, foundations, individuals and other entities worldwide.