A class action has been filed against Brocade Communication Systems, Inc. (NasdaqNM:BRCD), certain of its officers and directors by stockholders who purchased the company's common stock between February 21, 2001 and May 15, 2005. 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.

According to a press release dated May 19, 2005, the complaint charges Brocade and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Brocade designs, develops, markets, sells and supports data storage networking products and services.

Specifically, the complaint alleges that throughout the Class Period, defendants issued materially false and misleading financial statements to the investing public. On May 16, 2005, the Company issued a press release announcing the restatement of its fiscal 2001 to fiscal 2004 earnings. The release stated that "the Company will restate its financial statements for the fiscal years ending 2002 through 2004 to record additional charges for stock-based compensation expense." The release noted that the Company estimated the impact of the restatement would be to reduce fiscal 2001 and fiscal 2002 earnings per share by up to $0.11 and $0.19, respectively. The Company also estimated that fiscal 2003 and fiscal 2004 earnings per share would be reduced as well. As a result of this announcement, Brocade's stock dropped to $4.13 per share, compared to the $40+ per share prices it traded at during the Class Period.

If you bought Brocade Communication Systems, Inc. securities between February 21, 2001 and May 15, 2005, inclusive, and would like to obtain information about the lawsuit, then you are invited to call (866) 467-1400 to speak with an attorney.