PHILADELPHIA, Aug. 2, 2002 (PRIMEZONE) -- On July 1, 2002, the law firm of Berger & Montague, P.C. (http://www.bergermontague.com) filed a class action suit against Omnicom Group, Inc. ("Omnicom") (NYSE:OMC) and certain of its principal officers and directors in the United States District Court for the Southern District of New York on behalf of all persons or entities who purchased Omnicom securities between April 25, 2000 and June 11, 2002 (the "Class Period").
The complaint alleges that defendants violated the federal securities laws by issuing materially false and misleading statements throughout the Class Period that had the effect of artificially inflating the market price of Omnicom's securities. Prior to and throughout the Class Period, defendants reported that Omnicom was continuing to experience growth in its revenues and earnings, despite the overall economic slowdown and the worst decline in advertising revenue that the industry had ever experienced. Omnicom's growth was attributed, for the most part, to the numerous acquisitions which it made, which favorably impacted the Company's earnings. However, on June 12, 2002, an article in The Wall Street Journal highlighted Omnicom's acquisition accounting and raised questions concerning Omnicom's creation of an off-balance sheet entity in which it transferred certain troubled Internet investments. In particular, with respect to Omnicom's accounting for acquisitions, the article noted that: (i) Omnicom created a materially misleading impression of its performance by immediately including revenue and earnings from recent acquisitions in its reported financial results, in contrast to its competitors which excluded the results for the first year after a company was acquired; (ii) Omnicom continued to owe hundreds of millions of dollars in additional payments for companies that it had previously acquired; and (iii) Omnicom faced a potential future liability whereby, under certain circumstances, it might be required to acquire companies in which it had invested. The Wall Street Journal article also described Omnicom's transfer of its Internet investments to Seneca Investments LLC ("Seneca"), which had been jointly created with Pegasus Capital LLP in May 2001. According to the article, Seneca had been created as a vehicle for Omnicom to avoid writing down the loss on its investments in Internet companies which had declined in value.
In response to The Wall Street Journal article, the price of Omnicom common stock dropped precipitously, falling almost 20% to close at $62.28, on volume of more than 31 million shares traded. On June 27, 2002, Moody's Investors Service said that it may downgrade Omnicom's credit ratings and, as a result, the price of Omnicom stock dropped 23% to a four-year low of $37.60.
If you purchased Omnicom securities during the period from April 25, 2000 through June 11, 2002, inclusive, you may, no later than August 12, 2002, move to be appointed as a Lead Plaintiff. A Lead Plaintiff is a representative party that acts on behalf of other class members in directing the litigation. The Private Securities Litigation Reform Act of 1995 directs courts to assume that the class member(s) with the "largest financial interest" in the outcome of the case will best serve the class in this capacity. Courts have discretion in determining which class member(s) have the "largest financial interest," and have appointed Lead Plaintiffs with substantial losses in both absolute terms and as a percentage of their net worth. If you have sustained substantial losses in Omnicom securities during the Class Period, please contact Berger & Montague, P.C. at investorprotect@bm.net for a more thorough explanation of the Lead Plaintiff selection process.
The law firm of Berger & Montague, P.C. has over 50 attorneys, all of whom represent plaintiffs in complex litigation. The Berger firm has extensive experience representing plaintiffs in class action securities litigation and has played lead roles in major cases over the past 25 years which have resulted in recoveries of several billion dollars to investors. The firm is currently representing investors as lead counsel in actions against Rite Aid, Sotheby's, Waste Management, Inc., Sunbeam, Boston Chicken and IKON Office Solutions, Inc. The standing of Berger & Montague, P.C. in successfully conducting major securities and antitrust litigation has been recognized by numerous courts. For example:
"Class counsel did a remarkable job in representing the class
interests." In Re: IKON Offices Solutions Securities Litigation.
Civil Action No. 98-4286(E.D.Pa.) (partial settlement for
$111 million approved May, 2000).
"...(Y)ou have acted the way lawyers at their best ought to act.
And I have had a lot of cases...in 15 years now as a judge and I
cannot recall a significant case where I felt people were better
represented than they are here ... I would say this has been the
best representation that I have seen." In Re: Waste Management,
Inc. Securities Litigation, Civil Action No. 97-C 7709 (N.D.
Ill.) (settled in 1999 for $220 million).
If you purchased Omnicom securities during the Class Period, please visit our website at www.bergermontague.com to view the complaint and join the class action or if you have any questions concerning this notice or your rights with respect to this matter, please contact:
Sherrie R. Savett, Esquire Todd S. Collins, Esquire Barbara A. Podell, Esquire Kimberly A. Walker, Investor Relations Manager Berger & Montague, P.C. 1622 Locust Street Philadelphia, PA 19103 Phone: 888-891-2289 or 215-875-3000 Fax: 215-875-5715 Website: http://www.bergermontague.com e-mail: InvestorProtect@bm.net
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca