According to a press release dated April 7, 2006, the Complaint alleges that defendants violated federal securities laws by issuing a series of materially false statements. Specifically, defendants failed to disclose the following: (i) that ASG was not charging its customers in accordance with applicable contracts; (ii) that ASG failed to properly credit customers with discounts, rebates or price savings resulting from purchases from alternative sources; (iii) that ASG failed to provide customers with proper credit for the return of pharmaceutical products; (iv) that defendants inappropriately established and used reserves during various periods over the last five years to more closely match SPP reported earnings to its budgeted results; and (v) that as a result of the foregoing, the values of ASG's net income, retained earnings and reserves were materially overstated at all relevant times.

The complaint further alleges that after the markets closed, on March 15, 2006, ASG announced that as a result of the findings of an internal investigation, it would restate earnings for the years ended December 31, 2001 through December 31, 2004 and for the first six months of 2005 and issue refunds of $3.6 million, plus interest, to customers for instances in which it failed to credit them with discounts, rebates or price savings to which they were entitled. On this news, the price of ASG fell $5.65, or almost 29%, to close at $13.95 per share.

If you bought America Service Group, Inc. securities between September 24, 2003 and March 16, 2006, inclusive, and would like to obtain information about the America Service Group, Inc. lawsuit, then you are invited to call (866) 467-1400 to speak with an attorney.