Schiffrin & Barroway, LLP Announces Shareholder Class Action Against TALX Corporation -- TALX

Investors Have Sued TALX Corporation Alleging Securities Law Violations


BALA CYNWYD, Pa., Feb. 5, 2002 (PRIMEZONE) -- The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:

A securities class action lawsuit pending in the U.S. District Court for the Eastern District of Missouri claims that TALX Corporation (Nasdaq:TALX) and its underwriters with violations of the Securities Act of 1933 and the Securities Exchange Act of 1934.

Plaintiff seeks damages for violations of Sections 11 and 15 of the Securities Act of 1933 on behalf of all investors who bought TALX Corporation securities between July 18, 2001 and October 1, 2001 (the "Class Period").

Schiffrin & Barroway, LLP has prosecuted shareholder class actions for over fourteen years and has recovered more than $1 billion for investors. If you are a shareholder of TALX Corporation and want to learn more about this lawsuit and about becoming a lead plaintiff, you may visit our website at www.sbclasslaw.com.

The complaint alleges that the Missouri-based TALX Corporation, on August 3, 2001, completed a secondary offering of 3.245 million shares of its stock (the "Secondary Offering") (including over-allotments, and also including the sale of 253,000 shares by the Company's CEO), raising gross proceeds of approximately $100 million for the Company, pursuant to a Registration Statement and Prospectus dated August 2, 2001 (referred to collectively herein as the "Registration Statement/Prospectus").

The complaint alleges that the Registration Statement/Prospectus was false and materially misleading for the following reasons: Defendants had failed to disclose that the Company had improperly capitalized significant amounts of software related to the Company's customer premised systems line of business, which assets were already substantially impaired and which would have to be written off in the near term; Defendants failed to properly account for the true value of TALX's inventory, such that the overstated value of the Company's impaired inventory would have to be written down in the near term; Defendants misrepresented that the Company's business was expanding, when it was not, and at which time defendants were already planning on reducing staff and closing offices; Defendants were already planning to take at least $2.8 million in write-offs; and the outsourced benefits enrollment business was not operating according to the expectations that had been promoted by defendants, and this line of business was not a significant growth-driver as represented by the Company.

The complaint further alleges that, throughout the Class Period, the same factors which were not properly disclosed in the Company's Secondary Offering Registration Statement/Prospectus were also hidden by defendants from the Company's public shareholders. Defendants misled investors and analysts by issuing a series of false and materially misleading public statements which were designed to and which did artificially inflate the value of TALX shares. This inflation allowed the Company and its CEO to reap almost $100 million from the sale of stock.

Then, on October 1, 2001, weeks after defendants had sold almost $100 million worth of Company stock and used over $11 million in Company stock to acquire Ti3, that defendants issued a press release which revealed that TALX's fiscal 2002 earnings would be only $0.58-$0.62, excluding charges, on revenues of less than $50 million and that second quarter fiscal 2002 revenues would be less than $12 million. TALX also announced it would recognize charges of $2.8 million to write off capitalized software costs, inventory and to close offices.

If you purchased TALX Corporation securities between July 18, 2001 and October 1, 2001, you may be a member of the class and have until February 24, 2002 to move the court to become a lead plaintiff. In order to serve as lead plaintiff, however, you must meet certain legal requirements. To be a member of the class, however, you do not need to take any action at this time. Should you decide to seek appointment as a lead plaintiff, you may retain Schiffrin & Barroway, or retain counsel of your choice.

To learn more about your rights and interests in this case and your ability to potentially recoup your losses, please contact Schiffrin & Barroway (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) directly at 888-299-7706 (toll free) or 610-822-2221, fax number 610-822-0002, e-mail at info@sbclasslaw.com or visit our website at www.sbclasslaw.com.

More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca



            

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