Stockholders v Pathmark Stores, Inc.
Pathmark Provided Materially Misleading Information To Shareholders
A class action has been filed against Pathmark Stores, Inc. (NasdaqNM:PTMK), certain of its officers and directors by stockholders who purchased the company's common stock between May 06, 2005 and June 09, 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 June 16, 2005, the complaint charges that Pathmark and is board of directors provided materially misleading information to shareholders in connection with a Proxy Solicitation seeking shareholder approval of an investment in Pathmark by Yucaipa Partners, LLC. The proxy solicitation was misleading because it failed to inform investors of an alternative cash-out transaction, through which all Pathmark shareholders would receive $8.75 per share, that had been presented to Pathmark's Board of Directors on June 1. This alternative offer represented a greater value than the Yucaipa Transaction which the Board was recommending. The Complaint also alleges that the defendants breached their fiduciary duties in negotiating with Yucaipa by continuing to recommend that shareholders approve the Yucaipa Transaction even after the alternative offer had been made.
If you bought Pathmark Stores, Inc. securities between May 06, 2005 and June 09, 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.
