Class Action Lawsuit Against VA 218
Yahoo has a story up now about
a class action Lawsuit against VA, which is my employer, and owns Slashdot, so
of course I'm biased blah blah. Of course, I have no clue about any of
the stuff in the article because it's about stock allocation by
Credit Suisse during the IPO, and that sort of stuff is way outside
the realm of things I have any understanding of. Update: 01/11 09:58 PM by H : The Milberg people have a website with more info and PDFs about it -- and I just tried VA, who have "categorically no comment."
Linux is a registered trademark of Linus Torvalds (Score:1)
do you perhaps mean "VA Linux"? (Score:3)
lets assume the worst, (Score:1)
Does slashdot have a backup plan? I really hope that if VA goes, slashdot will still somehow survive.
I assume some kind-hearted-soul would be able to provide slashdot with ample hosting?
yikes.
Re:Bill Lerach - "bloodsucking scumbag" (Score:2)
Look at it this way: Would you want to be a corporate director if you knew that you personally could be bankrupted by any two-bit shyster looking to make a fast buck off the slightest misstep the company makes, or even events in the market that have nothing whatsoever to do with the company's performance? 211 would basically have taped a giant "kick me" sign to the back of every corporate director in California, which would include a large portion of the Silicon Valley VCs...and for no other purpose than lining the pockets of Lerach and his ilk.
If lawyers didn't already have a bad name, Lerach could single-handedly give them all one.
Eric
--
Its a time to sit back and be calm (Score:1)
What the persons at this law firm are probably not aware of is the role that VA has taken for us all as a community. NO COMPANY has taken a larger or more active role in building, supporting and caring for members of the Linux and open source universe. Just think of the tools provided to us FREE via Source Forge alone. Let us remember how that IPO they are complaining about, was about as open to the community as it could possibly be. Again, I could go on for a couple hours here about all the cool stuff and good deeds done by that team of Uber Geeks.
Every person in the Linux community owes many debts to VA, even if you are not aware of them. And, along with other leaders of this community, every person in this nation owes a debt to Larry for what the leaders of this community have done for the IT world. Larry was a big part of that community team, that community effort that has helped stop the total dominance of IT by Microsoft & Sun.
This Guy and This company are class acts.
Lets start repaying the debt owed by being calm and letting VA's legal team get in place and do their job. This is the US folks. Innocent until PROVEN guilty and all that stuff. If indeed some person at Credit Suisse has made some side deal it should be prosecuted. But, I have no fear that VA with persevere and come out clean.
Re:Several people are asking (Score:1)
'Motors' is the largest part of the name.
One of the company's biggest focus is on motors.
So shall we henceforth refer to them as 'Motors'?
The answer is, NO, dumbass.
See you in hell,
Bill Fuckin' Gates®.
Re:I *knew* the IPO was a ripoff. (Score:1)
Milberg et al: class action mill (Score:3)
If an ethical law firm were involved, that would be a different story.
Re:lets assume the worst, (Score:1)
If Microsoft bought slashdot they'd certainly stick a few dozen developers on the system to help fix it up.
Of course, the first noticeable result would be the disappearance of all the pro-Linux and Anti-MS... ;)
I agree (Score:1)
Re:I do not speak legalese (Score:3)
Many of the companies I own stock in are being sued likewise (Corel, Plug Power, and Citrix).
Although these suits are without merit, they hurt the companies stock prices dramtically: look at each of the above company's history, and see the biggest dip the day after the suit starts (none have recovered).
Often, these suits end if the company can pay the lawyers enough money to "end the suit without predjudice", meaning, the shareholders can continue the suit (if they want), but the lawyers got their money and will run.
There was an article in Forbes a few months back detailing one lawyer who does busines this way (worth over $10B).
The companies and the shareholders (including the plaintifs) will all loose a great deal of money over these suits. The only winners (ever) are the lawyers.
That's why they do it.
These are *very* bad people (Score:1)
Look at it from the bright side (Score:1)
--
Re:Your "reasonable facsimile" of OSDN Slashdot (Score:1)
Any community that is sufficiently small and concentrated will not be affected by trolls. Look at some of the smaller Slash-like sites and mailing lists for some examples. As sites grow, like the Palm-centric Palmstation [palmstation.com], more protective measures have to be instituted to make sure that the trolls don't overtake the site. Hell, it even happened to K5 a few months ago.
Just FYI not a Troll..... (Score:2)
VA Linux Systems
today's high 9.50________previous close 8.09
today's low 7.87_________bid 8.50
today's open 8.00________ask 9.00
volume 2,034,900________earnings per share -1.92
52-week high 207.75_____dividend per share Not Avail.
52-week low 6.62_________dividend pay date Not Avail.
P/E ratio Not Avail._____ex-dividend date Not Avail
That really wasn't flaimbait. (Score:1)
It should not have been considered flaimbait - I had to point out that there is another perspective to this story which has apparently escaped a lot of people.
Instead of just rating it down, how about actually attempting to rationally argue the points I've made? Can you?
Re:Actually Quite Common... (Score:2)
I wouldn't blame the IPO company for offering the bribe.
Re:Sounds like typical Stock Market Gripes to Me (Score:1)
Re:Sounds like typical Stock Market Gripes to Me (Score:2)
If this was a story about Microsoft fixing licensing fees you would be screaming bloody murder.
This suit is about Credit Suisse, a large investment bank, making illegal backend deals to sell stock which was supposed to be offered PUBLICLY to large customers at preferred prices.
The fact that some idiots moderated you up to 5 is even more frightening. Just because a company sells Linux-based software doesn't make it as clean as the wind-driven snow!
I think it is time for trolls like you to just go away and crawl back under the rock that you came from.
Re:These guys sue everybody (Score:2)
Um, no. Thanks to the Prop 211 fiasco, I had contempt for Lerach and his cohorts years before I had even heard of VA Linux, and while I was still working as a Windows programmer.
Yes, if someone profited illicitly from the VA Linux IPO, those people should be held accountable for their actions. But the mere fact that Lerach, and/or his firm, are involved with this lawsuit, viewed in light of their prior track record, strongly suggests that their motives are, shall we say, not entirely in line with those of their "clients." (Look it up for yourself; I dug up those three links I posted in my previous posting [slashdot.org] in about two minutes by searching on Google for "Bill Lerach." There's more where those came from. A lot of people hate this guy's guts, including people that could give a rat's ass about Linux.)
Eric
--
Re:Several people are asking (Score:1)
Yea, and in a similar paper about Blizzard Entertainment ("Entertainment") and Electronic Arts ("Electronic") or ("Arts") and Broterbund Software ("Software"), they could sue Electronic, Software, and Entertainment. Is this stupid, or lame?
False dichotomies and Clinton the Bloodsucker... (Score:2)
...may or may not be guilty of unfairly supporting the trial lawyers. But one thing we do know is that the following statement is false:
However, President Clinton has pushed hard against every kind of tort reform effort.
The real problem with tort reform is similar to the problem with campaign-finance reform. Everybody knows something should be done, but the only people making proposals are those with a strong interest in an unfair system: Republicans and Democrats in the case of campaign-finance reform; insurance companies and lawyers in the case of tort reform.
The impasse has been broken on campaign-finance reform by an alliance between a Republican and a Democrat (McCain-Feingold) which addresses the problem without biasing the solution one way or the other. What we need is a similar kind of alliance or an independent group attacking the problem in the area of tort reform.
What it comes down to is this. The insurance companies define tort reform as: "You can't sue our clients. And, if you do, you can only ask for a small amount of money." And the lawyers define it as Prop 219 (or whatever it was that was defeated out in California).
Politicians (like Clinton) don't mind this because they can point out to voters the problems with whatever "solution" they are forced to take a position on and say they would support a reasonable solution. Since no reasonable middle-ground solution has been passed, we cannot know if this is true or not. "Support of reasonable reform" is what Clinton has said is his position (not "I will push hard against every kind of tort reform"). We don't know if he really means this because he has never been forced to take a position on real reform.
The weird thing about this one is that everybody knows what the real solution is (most countries have a version of it): Distinguish clearly in law between lawsuits which are not successful but are not frivolous and lawsuits which are totally without merit and frivolous; and then institute severe penalties for the latter without restricting the former.
This is not necessarily an easy distinction to make. But it is a distinction which already exists in U.S. law (it merely needs a clearer definition and stronger sanctions against the frivolous side of the distinction). And it has proven worthwhile everywhere it has been tried. Everywhere the insurance industry's version of "reform" has been tried it has hurt many people who were not abusers of the system.
BTW, be careful about repeating insurance-industry propaganda (like "Clinton is against all reform"). Early in my career as a journalist, I was taken in by an industry press release which had some great anecdotes about lawsuits, which I used in a story on the subject. I later learned that nearly every one of those stories contained deliberate lies about the actual facts. It is very easy to become a pawn of these people who are very effective at pushing hard for their own interests by convincing you they are working for your interests.
None of this should be taken in any way as supporting the lawsuit against VA Linux. It is a false dichotomy which the insurance industry likes to promote that you cannot oppose these frivolous lawsuits without destroying any right of individuals to seek redress in the courts.
Re:Your "reasonable facsimile" of OSDN Slashdot (Score:1)
Did M$ help write the press release? (Score:1)
Like Tetris? Like drugs? Ever try combining them? [pineight.com]
Wouldn't help (Score:1)
VA Linux (Linux or Company) (Score:1)
I like how the lawyers allowed VA Linux to be referred to as only "Linux".
In connection therewith, Linux filed a registration statement, which incorporated a prospectus (the ``Prospectus''), with the SEC.
Re:I Know Who Is Reall Behind This! (Score:1)
link (Score:2)
Re:Yes quite typical, but different than you say.. (Score:2)
11. VA Linux stock loses 95% of its value
I love the omission... how about 10.A. market nose dives.
In any case, after the crazy way the nasdac has been behaving it should be blatently obvious that stock prices have no basis in reality. For an extended period of time it has been simply an excercise in mob mentality. Everybody's been hit large and small. So you're going to grow by 4%, not 5%, this year. We'll all get out here's a 20% cut in your stock price? VA can't control its shareholders overreaction to its statements, or the general market skitishnes.
This has everything to do with dumb investors and nothing to do with companies. You shouldn't get into the market unless you do the research... and even then, these days the research sometimes isn't worth a damn.
--locust
Things you'll never see on Slashdot (Score:2)
2. A link to an oposing view with out first in some way slamming same...
3. Anything showing a weakness in any Linux or Slashdot affiliated companys..
No thies things will never be seen on Slashdot... Never... ever.. umm what?
My Non-Lawyer-Like Summary (Score:5)
1.) the prospectus for LNUX claimed that Credit Suisse would get 'n' shares
2.) Credit Suisse actually procured 'n+x' shares.
3.) Credit Suisse then made backroom deals with big Credit Suisse customers to sell them the stock at "better than market, but still not IPO price", in exchange for increased commissions.
4.) This "forced inflation" of the price, caused others to have to pay higher-than-fair value for the stock.
The plaintiffs appear to contend that the offering was illegal because (a) they lied on their prospectus (points 1 and 2 above), and (b) people paid artificially increased prices for the shares (points 3 and 4 above).
Basically. That's certainly not definitive legalese, but its how this untrained guy (who happens to enjoy reading/understanding court documents) would read it.
D
Re:Yes quite typical, but different than you say.. (Score:2)
8. Slashdot founders get millions.
Except that VA bought Andover (Slashdot's parent company) _after_ the ipo.
also it's worthwhile to point out that none of what you said had anything to do with the lawsuit except:
12. The shareholders get pissed off
If you want the real reason for the lawsuit read the article.
Very little merit in this. (Score:2)
None of this was probably known or imagined by VA. I suspect that if the "net stocks" had not crashed and burned, nobody would care. As it is, there is a lively "cottage industry" of lawyers such as the ones filing the case who will invent a class and file an action on pretty much anything after a stock's price has fallen. At the minimum, they expect to extort their legal fees from the company that they are filing against. The members of the class that they represent (please read invent) will get little or nothing. If they take all the time to file the papers necessary to claim their award, they will not make minimum wage. In the meantime, the law firm compensates itself with the majority of the moneies awarded.
<rant>
This practice by legal firms such as this represents perhaps the lowest in the legal profession. While they will tell you with a straight face that they are "representing the little guy", they are in truth only representing themselves.
disclosure: I own no VA stock
</rant>
Re:Several people are asking (Score:2)
Re:do you perhaps mean "VA Linux"? (Score:2)
New Slashdot Poll (Re:Goddamn Legalese) (Score:2)
a) Linux = 5 letters
b) VA = 2 letters
c) I'm illiterate.
Whoa (Score:2)
"Mr. Linux, what can you tell me of the conversation that took place in the VA Linux Systems boardroom on August 28, 1999 at 1500?"
"Clothes make the man. Naked people have little or no influence on society. --Mark Twain"
"Mr. Linux, may I remind you that this is a court of law?"
"Old musicians never die, they just decompose."
"And just what do you mean by that remark?"
"Q: What do you call a blind, deaf-mute, quadraplegic Virginian? A: Trustworthy."
And so forth, into the night...
--
Yes quite typical, but different than you say... (Score:5)
1. VA Linux notices hot market for IPO's
2. VA sees lots of others making huge money from stock offerings
3. VA promotes Linux as 'next big thing'
4. VA associates itself with being the bringer of Linux
5. VA uses Slashdot to bolster that perception by the public
6. VA misleads people into thinking that they actually can provide real value, and be a profitable company.
7. Unwitting investors believe this, and buy the stock.
8. Slashdot founders get millions.
9. VA insiders cash out their options, reaping millions of their own (along with the VC's)
(The CEO, Larry Augustin, made off with $10 Million of stockholder money)
10. VA Linux stock crashes, as they have no possible way of justifying the market cap.
11. VA Linux stock loses 95% of its value
12. The shareholders get pissed off
13. Lawyers find a way for some people to recoup their losses
14. The people who lost money eagerly go after VA.
Folks, do you have ANY idea how much money the VA insiders walked away with? Do you have any idea on WHOSE money that really was? Do you really think that the VA insiders actually earned it, or did they con the public into thinking there was real value?
If you con someone, is it the fault of the con-man, or the fault of the 'idiot', as you say?
This story is repeated every day with different companies. This may be flaimbait, but I think it is about time that company founders start accepting the consequences of misleading a gullible public.
[For the record, I never bought or sold a single share of stock in my life. I just watch with disgust, usually, at the behaviour of these hype-stock companies]
Bastards! (Score:3)
Re:Several people are asking (Score:2)
They haven't done their homework and thats why people are pissed that they are associating totally two different things (company/kernel). This shouldn't be done; however I don't think we'll hear much from Linus Torvalds on the topic. Worst comes to worst the matter will be cleared up in court. Whether it be with a counter suit from Linux claiming that the software/kernel are too different things and that as a result an estimated "number here" was loss.
That's what happens when you are greedy and don't know what you are talking about.
Check out those documents... (Score:2)
Looks like there were some shady dealings going on with the IPO. No matter how much I like VA Linux, there's no excuse for this, and no company should be allowed to get away with it. Here's hoping they learn a hard lesson.
--
Re:These guys sue everybody (Score:2)
You people are clearly letting your emotions about 'linux' guide your contempt for lerach & his cohorts... It looks like the IPO was handled ineptly, and even if there is the slightest chance that gross, incotrovertable negligence is to blame for that, you need to have the situation examined and arbitrated. that is what Tort is all about. And if it turns up that the good ol boys at valinux did make mistakes, somebody somewhere has to pay the piper. WHO BETTER than the dorks that screwed this particular pooch of an IPO? who better to pay up than the party that profitted from the IPO? What? You have NO answer to that? So very fscking good of you to consider the situation before spouting off!!!
Letting your 'feelings' for Linux and/or this particular corporation guide your opinion of this lawsuit is not rational- BY DEFINITION. Do any of you 3117 455 industry analysts and armchair attorneys consider yourselves irrational? NO! You all pride yourselves on your rationality. So wtf are you guys spouting about?
At no point are any of the plaintiffs here being dishonest or malicious. They are fully justified in their minds, and aren't afraid to say it. I'll leave you with this quote from Lerach to chew on. and next time, have some fscking perspective before spewing such uninformed cynicism!
"Like the anti-trust bureaucrats who attack free enterprise in the name of free markets, Lerach defends his aggressive filing of lawsuits as necessary to police private markets. Says Lerach, "Private enforcement of the law, guided by the profit motive, overseen by an independent federal judiciary, working within laws we have all agreed upon through our elected representative, [has a] useful role to play," in keeping markets strong and fair."
Solidus Fullstop, Esq.
Anti-Class action? (Score:2)
Could investors legally side with VA and join VAs site of the legal battle?
Could investors who disagree with this lawsute something to terminate, oppose or in some way registure the fact that this lawsite is not in prepresentation of there own intrests?
It would be my guess that something could and should be done by VA supporting investors to oppose this...
Ideally Linux IPO investors are Linux advocates and many would not want such a lawsute on the behalf of themselfs...
But Linus owns Linux (Re:Several people are asking (Score:2)
So this use of the name maybe make sense when you think about it, but for a law firm it's extremely careless and almost certainly actionable. And given that we know Linus does act against improper uses of his trademark, I see in my crystal ball another large chunk of the Linus Torvalds Personal Pension Fund coming on a check with 'Milberg' on the top...
It couldn't happen to a more deserving cause!
Re:I do not speak legalese (Score:2)
violations.
Although these suits are without merit, they hurt the companies stock prices dramtically: look at each of the above company's history, and see the biggest dip the day after the suit starts (none have recovered).
I wonder if it's securities fraud (trading on inside information) to:
- Buy a big bunch of "put" options or short a bunch of the company's stock, then...
- Bring such a suit.
I think it would be useful for companies being so sued to check whether any of the parties to the suit are palying that game, too. (If so you could get them in a HEAP of trouble - and find grounds for a counter-suit, too.)
Heck: If the FTC made a point of investigating the recent trades of anyone bringing such a suit, looking for such shenanigans, I bet it would put a real damper on them.
Re:This is simple stuff (Score:2)
Umm... okay
I'm not against lawsuits -- they actually are one of the best methods by which corporations can be kept in line, instead of massive governmental control.
Plus, that 30% settlement money doesn't just sit around in a pile, the lawyers pay employees, buy yachts, buy computers, pay nerds to run the computers systems, etc. It's a form of wealth redistribution.
I just find it pathetic that a law firm thinks so little of itself (or has such a limited imagination) that it does things like this...
Re:Actually Quite Common... (Score:5)
I feel the same way but the truth is that dotcomm boards have been getting away with things that would seem unethical in traditional companies for quite a while. Here's an article on Fortune [northernlight.com] about some more weird dealings by the board of a dotcomm, most of these seem like fraud or at least seem unethical but so far not that many people seem to be getting punished.
Here's an expose on the shadiest dealing of the New Economy entitled MISADVENTURES IN THE ME-FIRST ECONOMY: Four tales from the ethical gray zone of the Internet economy [fortune.com] from Fortune.
Grabel's Law
Press Releases passed off as legitmate news (Score:3)
Obviously there's a whole lot more to this story. I don't dispute its potential news-worthiness and appropriateness for posting here. But the creation of news that is so uncritically "reported" by simply issuing a press release seems somehow opportunistic and irresponsible.
Oh yeah, we're talking about lawyers and news online. Never mind.
-schussat
Sounds like typical Stock Market Gripes to Me (Score:5)
This is simple stuff (Score:3)
File this under To Be Ignored
Re:Check out those documents... (Score:2)
that's the allegation, near as I can tell.
D
IANAL, but... (Score:5)
It looks like a few select investors and fund managers were hot to get in on the IPO. Not just anyone can buy IPO shares at the initial price, because those shares are restricted. So the investors paid off Credit Suisse, who were in charge of the IPO, by giving Credit Suisse extra commissions... a deal that Credit Suisse negotiated.
In some cases, the investor's commissions were determined by how much the IPO stock rose, aand therefore how much money the investors made on day one. (Note: and you thought BOXING was fixed...)
Even though CS did the dirty work, this involves VA Linux because it's VA Linux who writes the conditions of the IPO deal. And if not as many shares were available as VA Linux said there would be, they "lied" -- and the rest of the shareholders have gotten a raw deal. And due to supply and demand, if not as many shares were available as VA Linux said there would be -- that would have the effect of driving up the share price even higher at its opening.
Re:Yes quite typical, but different than you say.. (Score:2)
I think there are two places where your view sharply diverge from reality:
There is no such thing as an "unwitting investor." People who give give money to endeavors they make no effort to understand, in the hopes of making large profits, are not called "investors." They are called gamblers, or speculators. Con men call them "dupes." No-one calls them "investors." These lawyers have no interest in helping anyone recoup their losses. They are not going to help anyone recoup their losses. I do not share the same general animosity and lawyers and the legal system held by many other people on slashdot; but it is painfully clear that in this case, dirty little parasites hope to use the broken parts of the US legal system to suck as much blood as they can out of VA Linux, with no intention of passing any significant amount back to the investors. Frankly, it's often the fault of the person getting conned. In general, con men don't con stupid or gullible people. They con greedy people. If you check out most of the successful cons jobs out there, they usually involve greedy dupes who were led to believe they were somehow taking advantage of the con man. It's true that the Internet IPO market started to look kind of ugly in the last few years, but it was never the case of greedy, evil companies taking poor, unsuspecting dupes to the cleaners. The reality is quite a bit more complicated. It usually is.Who SHOULD be sued here? (Score:3)
- 1. There was something like a 'friends and family' program with the VA Linux IPO, where certain people got shares of VA Linux at the IPO price (this is common in IPOs).
- 2. VA Linux's underwriter, Credit Suisse ('CS') had a 30-day option to sell even more shares of VA Linux at the IPO price, up to 15% of the number of shares in the original IPO (this is also common in IPOs; the underwriter generally exercises the option and sells the shares if the IPO is a hot one).
- 3. The complaint basically says that these 'friends and family' shares and option shares were sold by CS to certain people in ways that gave CS extra benefits, hurting investors who could not buy these shares at the IPO price from CS.
- 4. This has been a sore topic for the SEC lately, where certain people get shares at the IPO price, and then can turn around and tell them immediately after the IPO, turning a very large profit, quickly.
- 5. It really has nothing to do with VA Linux itself, other than the mechanics of VA Linux's IPO.
This begs the question of why Credit Suisse isn't under investigation by the Securities and Exchange Commission [sec.gov] and on the receiving end of this lawsuit as well, but I've heard nothing of the sort (so far)...--
Re:Happened to Me (Score:2)
Nobody would want to pass up that deal, and really I don't see how it is illegal. The additional shares you purchased were owned (it seems) by VA. Unless they've made a law against it, you can sell your property for whatever price you want. VA could have sold those shares for $.02 each if they wanted. As for people who are bitter about not being on the friends list, tough luck. It seems you were added to the list because you DID something to get there, and you deserved it. Good for you.
--John
JWTADT (Score:2)
I worked (technically still work, but the company recently shuttered it's doors) for a now-maligned
.com. We had a decent IPO, but in typical
so.
After the stock took it's initial nosedive, the lawyers crawled out of the woodwork, attempting to
scare up enough PO'd investors to raise a class action suit. A bit of research into the first
bottomfeeder to raise it's head showed me that the only reason for this (the attack weasels) firm's
existence was classaction suits, mostly against companies who's stock performance was less than
profitable.
This is NOT a good situation to be in. Even tho nothing had been officially served at the time,
the very smell of litigation scared off those who might have assisted us, and tied our hands in
other matters. IMHO, we could have worked our way out of the slump and gone somewhere. Instead
we're boxing it all up for the liquidators and turning off the lights.
We wern't the first to fall prey, and we certainly won't be the last. The bitch of it is, it's not
like these class action suits provide any relief to the 'victims' - they'll by lucky to see a few
cents (or fraction of a cent) on the dollar returned to them, while the attack weasels line
their pockets and buy another vacation home.
For those that prefer code... (Score:2)
VA and Credit Suisse agree to not tell the SEC what they are doing. Credit Suisse
also agrees to help the IPO look really good by getting "major investors" to buy
big at ** inflated prices ** after the IPO. This will return inflated profits and
will inevitable result in frenzied Post-IPO buying. */
#include <standard_Bank_Procedure.h>
#include <pretty_underhanded.h>
int main(){
char VA_Linux = "Linux" ;
unsigned long int Make_Client_Overpay_After_IPO = 999999999999;
unsigned long int A_Shit_Load_Of_Money_To_VA_And_Credit_Suisse = ;
unsigned long int shares_left = 4500000;
/* Legal */
agreeToUnderwriteShares(VA_Linux);
do{
/* Illegal */
sell_Extra_Shares_Really_Cheap(excessive_fees);
sell_Shares_Cheap(Make_Client_Overpay_After_IPO);
sell_Shares_To_Anybody();
} while(VA_Does_Not_Disclose_To_SEC || shares_left == 0)
return A_Shit_Load_Of_Money_To_VA_And_Credit_Suisse;
}
Re:These guys sue everybody (Score:5)
These kinds of tort proceedings are very common. Of course, the lawyers who file the lawsuits on behalf of the shareholders typically represent only a small fraction of shareholders. These lawsuits are designed to mainly benefit the law firms which file them, rather than the stockholders. (This, BTW, is the case with most class action lawsuits because they aren't adequately regulated. Lawfirms constantly defend the broken system by claiming that Big Corporations are trying to stop you from suing them.)
This is vulturism, and the whole field needs reform. However, President Clinton has pushed hard against every kind of tort reform effort. Hopefully we'll see something in the near future to stop these stupid and predatory lawsuits.
Re:Did M$ help write the press release? (Score:3)
--
Re:link (Score:2)
Actually Quite Common... (Score:5)
PS: Another questionable practice that was quite common in 1999/2000 was giving away lots of shares by CEOs of IPO-track tech companies to executives of potential customers. These executives then made sure the IPO-track company won whatever contract was being vied for which would then make the pre-IPO company a hot stock when it burst on the market.
E.g. www.routerparts.com gives Cisco exec a few shares before their IPO and places him on their board. Cisco exec then makes sure routerparts.com gets a large order from Cisco and tells all his friends about them. routerparts.com now has good buzz since it has made deals with Cisco and other companies and becomes a hot IPO stock. Finally, the Cisco exec unloads the shares and makes several hundred to a few million dollars.
Grabel's Law
Re:Bill Lerach - "bloodsucking scumbag" (Score:2)
Why is it our culture/society puts up with destructive assholes like him?
--
Re:I *knew* the IPO was a ripoff. (Score:2)
Lessee... $1 000 000 invested to earn 10% annual interest = $100 000 a year for life, without touching the principle.
Shit, ya know, I think I could go for that.
--
Re:Yes quite typical, but different than you say.. (Score:2)
By your rational the whole market (under any conditions) is a con. By extension any form of sale (for cash) or barter is too. Any place where I as a merchant try to sell something to a buyer is. After all, I'm going to proceed so as to make my goods appear as valuable as possible (to all buyers).
people finally realizing that there is no way these companies can sustain their market cap
Nope. What caused the crash is people stopping to believe that everyone else was believing. Its all about consumer confidence... which is like a shared halucination. I think that the market is going to go up, and that I can make money buying this stock. Whats more a lot of other people share the same belief, so the stock keeps going up. As long as more people believe that they can make money then those that don't, the stock will keep going up. The market cap (total value of all shares) is a manifestation of the shared halucination. The real things are the earnings per share, the profits and so on. Economists have been warning for months, if not years, that there was a stock bubble and grinding their teeth about how bad it will be when it bursts. Their main point has been that by all (what had been up to now) rational indicators (earnings etc) these stocks were not worth what they were being traded for. But their words fell on deaf ears. Everyone believed that yahoo was work 200+$/share. After all, all of america can't be wrong. But the moment the halucination ends yahoo is worth (relatively) peanuts.
--locust
Re:I *knew* the IPO was a ripoff. (Score:4)
Re:These guys sue everybody (Score:5)
The "Lerach" bill [motherjones.com]
Year 2000 suits [techweb.com]
And on Red Herring [redherring.com]
When they got sued and lost [coopercook.com]
The public mislead themselves (Score:5)
Sorry, but anybody who paid the ridiculously high prices in the post-IPO environment and is now sitting on big losses has nobody to blame but themselves (and possibly their investment advisors).
Re:These guys sue everybody (Score:2)
ever think that maybe people can do legitimate legal work that involves suing people?
Hemos Time Machine (Score:2)
How does Hemos get so far ahead of us?
--
Ironic double-edge (Score:2)
Re:I do not speak legalese (Score:2)
"Bend over and enjoy it!"
Hooptie
So... (Score:2)
Several people are asking (Score:3)
Look at the name VA Linux - 'Linux' is the largest portion of the name
This lawsuit is about the aclaimed practices of VA Linux during their IPO - Their sticker name is LNUX I believe (or something very close)
One of the company's biggest focus is on Linux
Any ( and probably all ) these reasons could be why the lawfirm chose to use 'Linux' as the abbreviation of VA Linux. It really does make sense when you think about it.
Re:...and more (Score:2)
He can and he should. A big one.
Re:Don't give it much credence (Score:2)
You mean carefull, not cluefull, right? As they have set themselves up for a trademark infringement suit. And a good one...
Re:Bill Lerach - "bloodsucking scumbag" (Score:2)
Re:Poetic justice (Score:2)
If you ignore the 100s of paid developers that work for VA, producing nothing but 100% free open source code for Linux, you'd be right.
One-Click Lawyer Retaining Patent? (Score:5)
"Click Here to Retain Milberg Weiss"
Now there's a nice target for Amazon to sue... Or maybe they (milbergweiss) already have a patent for 'one click lawyer retaining'?
Sorry, I dislike lawyers and everything related to them. My parents taught me not to lie. Guess their parents did the same, but they obviously interpreted it as 'lie if the price is right'. 'Nuff said...
No... (Score:2)
Goddamn Legalese (Score:3)
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a class action lawsuit was filed on January 11, 2001, on behalf of purchasers of the securities of VA Linux Systems, Inc. (``Linux'' or the ``Company''...
Further reading of the article produces such phrases as "The action...[is pending]... against defendants Linux, Credit Suisse First Boston Corporation...
They're suing "Linux"?
...and more (Score:2)
[...] On December 9, 1999, Linux completed an initial public offering of 4.4 million of its shares of common stock at an offering price of $30 per share (the "Linux IPO"). In connection therewith, Linux filed a registration statement, which incorporated a prospectus (the "Prospectus"), with the SEC. [...]
can Linus [Torvalds] file a countersuit on grounds of FUD, trademark violation, and general idiocy by means of legalese?
Re:Goddamn Legalese (Score:2)
What have you done for the community today?
Re:what it means... (Score:5)
1. There was something like a 'friends and family' program with the VA Linux IPO, where certain people got shares of VA Linux at the IPO price (this is common in IPOs).
2. VA Linux's underwriter, Credit Suisse ('CS') had a 30-day option to sell even more shares of VA Linux at the IPO price, up to 15% of the number of shares in the original IPO (this is also common in IPOs; the underwriter generally exercises the option and sells the shares if the IPO is a hot one).
3. The complaint basically says that these 'friends and family' shares and option shares were sold by CS to certain people in ways that gave CS extra benefits, hurting investors who could not buy these shares at the IPO price from CS.
4. This has been a sore topic for the SEC lately, where certain people get shares at the IPO price, and then can turn around and tell them immediately after the IPO, turning a very large profit, quickly.
5. It really has nothing to do with VA Linux itself, other than the mechanics of VA Linux's IPO.
6. This is a personal interpretation, not a legal opinion.
Relax. This is not a problem (Score:2)
These sorts of shenanigans have been going on for years precisely because they're not actually shenanigans: they're just a normal part of the process. When you start a company, it's your business whom you pick to be your partners. It's the same with initial public offerings, except those are even more democratic in nature.
When Redhat went ipo, plenty of people active in the opensource movement got a special offer to join the IPO, and slashdot was abuzz with the excitement of it all. This with VaLinux is just another kind of special offer. Nothing to see here; move along.
Re:Goddamn Legalese (Score:2)
He might have a case against them.
Re:link (Score:2)
(but only when it affects their wallets)
--
Duty of care (Score:2)
what it means... (Score:5)
Happened to Me (Score:2)
The whole VA IPO was pretty strange. The "friends" (some Open Source developers and such) each had the option to buy 100 shares of VA at $30 provided we all filled out the right paperwork ahead of time.
The strange part was, two days after the IPO (while frantically trying to get a confirmation that Credit Suisse had indeed received all the paperwork and actually pay for the shares) I mananged to get in touch with a CS broker. She then said that VA had a new plan where I could purchase an additional 30 shares at $30 and would I like to do that? I was completely baffled that they could do this. The current market price was close to $300. Who wouldn't want to take that deal? Zero risk, big gain.
I immediately sold those 30 shares for about $4800 profit. Those of you who think this math is wacked need only recall taxes, etc. At least I paid for all the money I forked over to buy the shares initially so I don't feel so bad that they're nearly worthless now.
Perhaps this little "extra" is the problem some investors have with Credit Suisse. It did seem a bit arbitrary that they would offer this to people after the IPO had happened. It's one thing to sign up for an IPO where your committing the purchase price regardless of the outcome of the IPO and a whole different thing to choose after the fact if you want to buy more at the same price.
I'm posting anonymously since many people are still bitter about not being on the VA friends list and I don't want to rub it in anyone's face that I made it on.
what's going on [IAAAL] (Score:2)
2) CSFB is being sued not only for VA Linux's charge, but also for fraudulently selling some of its allotment of shares (a 10(b) violation and a section 12(a)(2) violation). While 10(b) is pretty broad -- and thus VA Linux could feasibly have been within its net -- Milberg probably thought it couldn't allege all the elements of a 10b-5 violation (most likely because it didn't think it could allege that VA knew about what CSFB was doing) to include VA in the count.
3) VA's and CSFB's counsel has defended more securities class action suits than any other firm in the nation. Suffice it to say they're well-represented.
Bill Lerach - "bloodsucking scumbag" (Score:5)
Read that article...it describes some of Lerach's tactics in detail, tactics which you can bet your ass he and his partners will employ against VA Linux. (He once sued Sun Microsystems simply because he got left out of a $30M lawsuit settlement; Sun eventually had to pay him $1.5M just to get him to go away.) And check out this Fortune sidebar [fortune.com], too...not even Pikachu is safe from this man...
But he can be beaten...just check out this article [coopercook.com]...
Eric
--
Re:Press Releases passed off as legitmate news (Score:2)
Note the Business Wire [businesswire.com] logo on that Yahoo page [yahoo.com]. As far as I can tell, The law firm of Milberg Weiss Bershad Hynes & Lerach LLP [milberg.com] simply paid Business Wire to distribute their press release, and Yahoo put it up on their site automatically, as they do many BW press releases [yahoo.com].
There's no conspiracy here. Move along, move along.
-- R.
putting VA's IPO in perspective (Score:2)
according to Bloomberg analytics, VA had the best first-day performance of any IPO during Q4 99. they beat out 160 other IPOs for the largest first-day gain of 797% (from IPO price of 30 to close at 239 1/4). and it went even higher, to 252, in after-hours trading that day.
so i don't find it tough to believe that funny stuff was going on.
-----
Re:These guys sue everybody (Score:5)
Theoretically, yes.
In this case, they're lawyers. So the answer is no.
And this means that... (Score:2)
There's a nice change (Score:2)
Re:Correction (Score:2)
These guys sue everybody (Score:5)
Bloody leaches.
Re:These guys sue everybody (Score:2)
Re:craziness (Score:2)
CADE I thank you, good people: there shall be no money;
all shall eat and drink on my score; and I will
apparel them all in one livery, that they may agree
like brothers and worship me their lord.
DICK The first thing we do, let's kill all the lawyers.
CADE Nay, that I mean to do. Is not this a lamentable
thing, that of the skin of an innocent lamb should
be made parchment? that parchment, being scribbled
o'er, should undo a man? Some say the bee stings:
but I say, 'tis the bee's wax; for I did but seal
once to a thing, and I was never mine own man
since. How now! who's there?
2 KING HENRY VI, ACT IV, SCENE II.
Shakespeare, of course.
There's nothing quite so nice as having *all* of the Bard's works on your hard drive. It's available on line, but it's been a while and I forgot where I got it. All I have to do is grep for stuff and I can make myself look like a real highbrow on the Internet.