RADNOR, Pa., Aug. 12 – LAWFUEL – The Law News Network — The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:
Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Western District of Missouri on behalf of all securities purchasers of American Italian Pasta Company (NYSE: PLB – News; “AIPC” or the “Company”) from October 25, 2000 through August 9, 2005, inclusive (the “Class Period”).
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Schiffrin & Barroway, LLP (Darren J. Check, Esq. or Richard A. Maniskas, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at [email protected]
The complaint charges AIPC, Timothy S. Webster, Horst W. Schroeder, George D. Shadid, and Warren B. Schmidgall with violations of the Securities Exchange Act of 1934. AIPC engages in the production and marketing of dry pasta in North America. According to the Complaint, the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the defendants failed to properly expense $6.6 million in promotional allowances and related customer deduction receivables during the Class Period; (2) that defendants failed to take timely write downs for spare parts inventory, which caused the Company to take a $5.4 million charge; (3) that defendants maintained inadequate reserves for slow moving, damaged and discontinued inventories; (4) that the Company failed to record $1.9 million in certain fixed asset retirements during the Class Period; (5) that as a result of this, the Company’s financial results were in violation of generally accepted accounting principles (“GAAP”); (6) that the Company lacked adequate internal controls; and (7) that as a result of the above, the Company’s financial results were materially inflated at all relevant times.
On August 9, 2005, after the market closed, AIPC announced a $60.7 million charge and a Securities and Exchange Commission (“SEC”) inquiry. More specifically, the Company stated the SEC was investigating it for various unspecified financial restatements and for transactions of the company’s stock by outsiders in late 2004 and early 2005, for which the Company had received inquiries from the New York Stock Exchange and the Philadelphia Stock Exchange. Additionally, the Company stated that it was delaying the release of its full financial results for the third fiscal quarter ended July 1, 2005, and was also delaying the filing of its third quarter Form 10-Q with the SEC. Moreover, AIPC stated that its Audit Committee is conducting an internal investigation of certain accounting procedures and practices and certain other matters.
On news of this, shares of AIPC fell $7.66 per share, or 36.58 percent, to close at $13.28 per share on unusually high trading volume.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin & Barroway, which prosecutes class actions in both state and federal courts throughout the country. Schiffrin & Barroway is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world. For more information about Schiffrin & Barroway, or to sign up to participate in this action online, please visit http://www.sbclasslaw.com
If you are a member of the class described above, you may, not later than October 11, 2005 move the Court to serve as lead plaintiff of the class, if you so choose. 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 Schiffrin & Barroway, or other counsel of your choice, to serve as your counsel in this action.
CONTACT: Schiffrin & Barroway, LLP
Darren J. Check, Esq.
Richard A. Maniskas, Esq.
280 King of Prussia Road
Radnor, PA 19087
1-888-299-7706 (toll free) or 1-610-667-7706
Or by e-mail at [email protected]