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Case ID: 3567 | Stocks | 07/20/2004
A class action has been filed against restaurant operator Quality Dining, Inc., (Nasdaq:QDIN) and certain of its officers and directors by stockholders who were offered $2.75 per outstanding share when company officials made a June 2004 announcement of plans to take the company private. The actions claim that the defendants violated their fiduciary duties to stockholders by advancing their individual interests at the expense of public shareholders. The action seeks an injunction stopping the effort to take the company private, as well as unspecified monetary damages.
In June 2004, five Quality Dining executives announced the plans to pay $2.75 per outstanding share, delist the company from the Nasdaq and take it back to private ownership. Daniel B. Fitzpatrick, chairman, president and chief executive officer, led the effort. Besides Fitzpatrick, who started the Mishawaka, Indiana-based company in 1981 as a Burger King franchisee, the suit names brothers Gerald O. and James K. Fitzpatrick, John C. Firth, Philip J. Faccenda, Ezra H. Friedlander, Bruce M. Jacobson, Steven M. Lewis, Christopher J. Murphy, III, and Quality Dining. Quality Dining executives cited the expenses of remaining a public company as the reason for going back to private ownership. The board already has directed an independent committee -- board members not part of the proposed buyout -- to review the offer. Company officials expected it to take months before the proposal would be brought before shareholders. Many shareholders met the announcement with dismay, particularly since they were offered $5 per share in May 2000 by QDI Acquisition, a subsidiary of former dissident shareholders NBO. The lawsuit alleged Quality Dining's offer of $2.75 per share constitutes unfair dealing because the price doesn't adequately reflect the progress and future value of the company. It also alleges that the members of the Fitzpatrick Group hold 44.7% ownership of the outstanding shares, which puts the group in position to "virtually ensure consummation of the transaction without regard to its fairness to Quality Dining's public shareholders." Since the initial public offering on March 2, 1994, when Quality Dining stock traded at $11.50, the stock has risen as high as $38.75 per share in 1996 and dropped as low as $1.96 on Dec. 12, 2001. Quality Dining owns the Grady's American Grill, Papa Vino's Italian Kitchen, and Spageddies Italian Kitchen concepts and operates Burger King restaurants and Chili's Grill & Bar restaurants as a franchisee. As of July 9, 2004, the Company operates 123 Burger King restaurants, 39 Chili's Grill & Bar restaurants, 7 Grady's American Grill restaurants, 6 Papa Vino's Italian Kitchen restaurants, 3 Spageddies Italian Kitchen restaurants and one Porterhouse Steaks and Seafood restaurant.
At Lawcash.com, it is our goal to keep you informed about important legal cases, class actions and settlements. Our lawyers offer free legal evaluations in tort cases, class actions, personal injury, and other lawsuits because we are dedicated to helping you resolve your legal complaints. Other Stocks Cases of Interest Several class actions have been filed against deep discount retailer 99 Cents Only Stores (NYSE: NDN) and certain of its officers and directors by stockholders who purchased the company's common stock between April 20, 2000, and February 4, 2004. The actions claim that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. Several class actions have been filed against e-messaging protection and transaction services provider Zix Corporation (Nasdaq:ZIXI) and certain of its officers and directors by stockholders who purchased the company's common stock between October 30, 2003, and May 4, 2004. The actions claim that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. The stockholders seek to recover compensatory damages for the loss of value of their stock. On April 21, 2008, a motion to appoint J & J Productions Pension Plan and certain individuals as lead plaintiffs and lead counsels was filed.
A class action has been filed against Juniper Networks, Inc. (JNPR), certain of its officers and directors by stockholders who purchased the company's common stock between September 1, 2003 and May 22, 2006. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. The stockholders seek to recover compensatory damages for the loss of value of their stock. On May 12, 2008, a motion to appoint lead plaintiff and lead counsel was filed.
According to a press release dated April 11, 2008, the class action is brought against Oppenheimer Holdings Inc., Oppenheimer & Co. Inc, Oppenheimer Asset Management and Freedom Investments Inc. (collectively, "Oppenheimer"), in connection with the sale of auction rate securities, auction rate preferred stock, auction market preferred stock, variable rate preferred securities, money market preferred securities, periodic auction rate securities and auction rate bonds (collectively, "Auction Rate Securities").
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