The action alleges that during the applicable period, defendants knowingly shipped unassembled electronic components even though they were aware that the components would not and could not meet the specifications, requirements and warranties of agreements entered into with its clients. The defendants allegedly caused SonicWALL to enter into these agreements with its clients with full knowledge that it would be unable to provide products that would meet the specifications, requirements and warranties of the agreements. Moreover, the defendants allegedly caused the company to enter into these agreements only to improve its financial status as part of an fraudulent plan to manipulate its financial earnings reports and artificially inflate its share price, while actually having no intention of delivering product conforming with the agreements. According to the action, there were substantial deficiencies in SonicWALL products, including, among other things, circuit boards that had not been programmed and that did not have connector ports that were necessary to perform the tests required under the warranties and agreements.

As a result of the defendants' issuance of misleading financial statements during the applicable period, SonicWALL's shares traded at artificially inflated levels, allowing defendants to sell $34 million worth of their own SonicWALL shares.

If you wish to serve as lead plaintiff, you must make your request no later than February 6, 2004. Any member of the purported class may request of the court that they serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.