NEW YORK, Aug. 15, 2002 (PRIMEZONE) -- Pomerantz Haudek Block Grossman & Gross LLP (www.pomerantzlaw.com) filed a class action lawsuit in the United States District Court for the Southern District of New York against Vivendi Universal ("Vivendi" or the "Company") (NYSE:V) and Jean-Marie Messier, the Company's former Chairman and Chief Executive Officer, on behalf of investors who purchased or otherwise acquired the securities of Vivendi during the period from February 11, 2002 through July 3, 2002, inclusive (the "Class Period"). The lawsuit charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by issuing materially false and misleading statements throughout the Class Period which served to artificially inflate the price of Vivendi's shares.
According to the Complaint, prior to and during the Class Period, Mr. Messier took Vivendi, a global media and communications company, on an acquisition binge that, according to published reports, resulted in the Company amassing approximately $18 billion in debt as he turned the Company from a water concern into an entertainment powerhouse. Under Mr. Messier's leadership, Vivendi completed a $30 billion buyout of Canada's Seagram and a $10.3 billion purchase of USA Networks Inc., the cable and entertainment company owned by Hollywood mogul Barry Diller. Concomitantly, Mr. Messier orchestrated a scheme to conceal the severity Vivendi's liquidity problems stemming from the massive debt load incurred as a result of these, and other transactions. In fact, only days before his ouster by Vivendi's Board, Mr. Messier caused the Company to issue several press releases that falsely stated that Vivendi did not face an immediate and severe cash shortage that threatened the Company's viability going forward absent an asset fire sale. It was only after Vivendi's Board dislodged Mr. Messier that the Company's new management disclosed the severity of the crisis and that the Company would have to secure immediately both bridge and long-term financing or default on its largest credit obligation.
As detailed in the Complaint, Mr. Messier failed to disclose the true contours of Vivendi's cash crisis and his affirmative misrepresentations to the contrary have given rise to an investigation by French authorities concerning whether Mr. Messier disclosed in a timely fashion that the Company was in dire financial straits. Published reports also indicate that Vivendi is engaged in urgent discussions with lenders to secure financing and is both considering and negotiating the sale of assets.
On July 2, 2002, several news services reported that Vivendi's Board had forced Mr. Messier to resign due to, among other things, the drop in the Company's share price and severe debt crisis. Thereafter, on July 3, 2002, the Company, through its new management, published a press release that The Wall Street Journal characterized as a "very different statement that, among other things, acknowledged a short-term liquidity issue." The statement revealed that Vivendi must repay creditors 1.8 billion euros by the end of July 2002 and further disclosed that 3.8 billion euros in credit lines were up for renegotiation. Vivendi's share price collapsed upon these revelations.
If you purchased the securities of Vivendi during the Class Period, you have until September 16, 2002 to ask the Court to appoint you as lead plaintiff for the Class. To serve as lead plaintiff, you must meet certain legal requirements. If you wish to review a copy of the Complaint, to discuss this action or have any questions, please contact Andrew G. Tolan, Esq. of the Pomerantz firm at 888-476-6529 (or (888) 4-POMLAW), toll free, or at agtolan@pomlaw.com by e-mail. Those who inquire by e-mail are encouraged to include their mailing address and telephone number.
The Pomerantz firm, which has offices in New York and Chicago, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class action litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz firm pioneered the field of securities class actions. Today, more than 50 years later, the Pomerantz firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca