December 11, 2003, Judge Cote of the Southern District of New York issued a deadline for current and former MCI and WorldCom (Pink Sheets: WCOEQ – News, MCWEQ – News, MCIAV – News) shareholders to “opt-out” of the WorldCom shareholder class action. Current and former shareholders must opt- out of the class action by February 20, 2004 if they desire to pursue individual claims against the defendants including Salomon Smith Barney, now operating as Citigroup Global Markets, a unit of Citigroup, Inc. (NYSE: C – News).
Parker & Waichman is encouraging current and former shareholders to explore their legal options before the opt-out deadline expires. Current and former WorldCom and MCI shareholders who do not specifically “opt-out” of the class action are automatically included in that lawsuit. Parker & Waichman has established a website www.worldcomstockfraud.com to assist current and former shareholders in their decision-making process. Free evaluations are offered at this site.
Parker & Waichman and associated counsel are currently representing hundreds of current and former WorldCom and MCI shareholders. Parker & Waichman believes that shareholders that sustained financial losses as a result of their WorldCom securities holdings may be better served by filing an individual claim against the defendants rather than participating in the class action.
Recently, the United States Bankruptcy Court approved MCI’s Plan of Reorganization, which paves the way for the company to emerge from Chapter 11 bankruptcy. As a result of MCI’s pending emergence from Chapter 11, it is likely that shares of MCI traded under the symbols WCOEQ and MCWEQ will be cancelled, leaving existing shareholders with a mere fraction of their initial investment.
The complaints already filed by Parker & Waichman and associated counsel charge Salomon Smith Barney with violations of Section 15(c) of the Securities Exchange Act of 1934, as well as various state statutes, for issuing fraudulent research reports and for violating NYSE Rules 401, 472 and 476(a)(6), and NASD Rules 2110 and 2210, for issuing research reports that were not based on principles of fair dealing and good faith, did not provide a sound basis for evaluating facts, contained exaggerated or unwarranted claims about the covered companies, and/or contained opinions for which there were no reasonable basis.
The misconduct of Salomon Smith Barney was detailed in the settlement announced earlier this year by Securities Regulators and state securities officials.
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