NEW YORK, Jan. 24, 2003 (PRIMEZONE) -- Wolf Popper LLP has filed a securities fraud lawsuit against Motorola, Inc. (NYSE:MOT), Christopher B. Galvin and Karl F. Koenemann, on behalf of persons who purchased Motorola common stock on the open market from February 3, 2000 through May 14, 2001. The action was filed in the United States District Court for the Northern District of Illinois, located at 219 S. Dearborn Street, Chicago, Illinois, 60604. The complaint can be viewed on Wolf Popper's website or obtained from the Court.
The complaint alleges that during the Class Period, defendants made numerous false statements about transactions between Motorola and Telsim Mobil Telekomunikasyon Hizmetleri A.S. ("Telsim"), a wireless telecommunications carrier with operations in Turkey. On February 3, 2000, Motorola announced that it had entered into a three year agreement to provide products and services to Telsim, and further stated "that revenue from this supplier agreement could be at least $1.5 billion."
Motorola failed to disclose that the sales to Telsim was predicated upon Motorola providing Telsim with $1.7 billion in vendor financing, in effect, loaning Telsim the money used to purchase Motorola products and services - and forcing Motorola to bear the enormous risk of default. Defendants further failed to disclose the deterioration of the relationship between Motorola and Telsim (placing the likelihood of payment in greater jeopardy); and also failed to disclose that the Company had, through similar vendor financing arrangements, provided its customers with an aggregate of $2.9 billion in vendor financing for purchases of Motorola products.
On March 29, 2001, Motorola disclosed in a Proxy Statement filed with the SEC that its vendor-financing commitments totaled $2.6 billion, of which $1.7 billion related to "a single customer in Turkey" (Telsim). On April 6, 2001, reports detailing Motorola's credit problems caused shares of Motorola stock to decline by twenty three percent (23%). In mid-May 2001, Motorola's quarterly SEC filing disclosed that Motorola had loaned Telsim $2 billion in vendor financing. Motorola also disclosed that Telsim had failed to make a scheduled payment of $728 million. Telsim eventually defaulted on its obligations to Motorola.
Class members who desire to be appointed a lead plaintiff in this action must file a motion with the Court no later than March 3, 2003. Class members who are interested in serving as a lead plaintiff in this action, or other persons who have questions or information regarding the prosecution of this action, are urged to call or write:
Wolf Popper LLP James A. Harrod, Esq. 845 Third Avenue New York, NY 10022 Tel.: 212.451.9642, Toll Free: 877.370.7703 Fax: 212.486.2093, Toll Free Fax: 877.370.7704 Email: irrep@wolfpopper.com website: www.wolfpopper.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.