NEW YORK – LAWFUEL – The Law News Network – The law firm of Milberg Weiss Bershad & Schulman LLP announces that a class action lawsuit was filed on July 22, 2005, on behalf of purchasers of the securities of Guidant Corporation (“Guidant” or the “Company”) (NYSE: GDT) between December 1, 2004 and June 23, 2005, inclusive (the “Class Period”), seeking to pursue remedies under the Securities Exchange Act of 1934 (the “Exchange Act”).
The action, numbered 05-CV-1078-LJM-WTL, is pending in the United States District Court for the Southern District of Indiana, Indianapolis Division, against defendants Guidant, Ronald W. Dollens (CEO, President), Guido J. Neels (COO), Keith E. Brauer and Peter J. Mariani. A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss’s website at: http://www.milbergweiss.com
If you bought the securities of Guidant between December 1, 2004 and June 23, 2005, inclusive, and sustained damages, you may, no later than August 23, 2005, request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as “lead plaintiff.” Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Milberg Weiss Bershad & Schulman LLP, or other counsel of your choice, to serve as your counsel in this action.
The Complaint alleges that, defendants’ positive Class Period press releases and SEC filings were materially false and misleading because: (a) a material portion of the Company’s defibrillator products contained life-threatening defects; (b) the unsafe defibrillators presented a material, undisclosed risk to investors; (c) the Company faced tens and potentially hundreds of millions of dollars in unreserved liabilities related to the defective defibrillators, such that the Company’s financial statements were not true or accurate or in compliance with Generally Accepted Accounting Principles (“GAAP”); (d) as a result of the significant product defects in Guidant’s defibrillators, the Company foreseeably faced a massive, expensive product recall, which would undermine the Company’s market credibility, future sales of Guidant products and profitability; and (e) defendants lacked any reasonable basis to claim that Guidant was operating according to plan, or that the Company could maintain its growth in sales of defibrillators in the foreseeable near-term.
On June 17, 2005, Guidant announced a recall of approximately 50,000 defibrillators. Then, on June 24, 2005, before the open of trading, defendants announced that it was investigating the safety of certain defibrillator components and advised doctors to “discontinue implants of these devices pending further notice.” In reaction to this announcement, the price of Guidant stock fell to $63.90 per share, from $68.60 per share on June 22, 2005, on unusually heavy trading volume.
Defendants were motivated to engage in the wrongdoing alleged in the complaint because it enabled company insiders to sell over 866,515 Guidant shares at artificially inflated prices, for proceeds exceeding $63.5million.
Milberg Weiss Bershad & Schulman LLP (http://www.milbergweiss.com) is a firm with over 100 lawyers with offices in New York City, Los Angeles, Boca Raton, Delaware, Seattle and Washington, D.C. and is active in major litigations pending in federal and state courts throughout the United States. Milberg Weiss has taken a leading role in many important actions on behalf of defrauded investors, consumers, and others for nearly 40 years. Please contact the Milberg Weiss website for more information about the firm. If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following attorneys: