“The following statement was issued today by the law firm of
Spector, Roseman & Kodroff, P.C.:”
“Notice is hereby given that a class action lawsuit was filed in
the United States District Court for the Southern District of New
York on behalf of all persons who purchased the common stock of VA
Linux Systems, Inc. (“VA Linux” or the “Company”) between
December 9, 1999 and December 6, 2000, inclusive (the “Class
Period”).”
The complaint alleges violations of Sections 11, 12(a)(2) and 15
of the Securities Act of 1933 and Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On
December 9, 1999, Linux completed an initial public offering of 4.4
million shares of its 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. The complaint alleges that the
Prospectus was materially false and misleading because it failed to
disclose, among other things, that: (i) Credit Suisse had solicited
and received excessive and undisclosed commissions from certain
investors in exchange for which Credit Suisse allocated to those
investors material portions of the restricted number of Linux
shares issued in connection with the Linux IPO; and (ii) Credit
Suisse had entered into agreements with customers in which Credit
Suisse agreed to allocate Linux shares to those customers in the
Linux IPO in exchange for which the customers agreed to purchase
additional Linux shares in the aftermarket at pre-determined
prices. As alleged in the complaint, the SEC is currently
investigating underwriting practices in connection with the Linux
IPO.”