Stockholders v Hibernia Foods, PLC
UK’s Hibernia Foods Accused of Securities Fraud in US Court
Several class actions have been filed against UK prepared food manufacturer Hibernia Foods, PLC, (OTC:HIBNY.PK) and certain of its officers and directors by stockholders who purchased the company's common stock between August 2, 1999, and October 21, 2003. 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.
The action alleges that the defendants misrepresented that Hibernia's financial statements were prepared in conformity with generally accepted accounting principles. Because of artificially inflated operating results and understated costs, expenses, and reserves, Hibernia stock traded at artificially inflated levels during the applicable period. The plaintiffs also allege that, by overstating earnings and failing to write-down impaired assets, the defendants misled the investing public. As well as failing to timely record write-downs in the value of Hibernia's property, plant, and equipment from 2000-2002, the action alleges that the defendants failed to disclose the nature and extent of certain deep discounts offered to customers from 1999-2002.
The plaintiffs also allege that Hibernia's auditor, PricewaterhouseCoopers, produced false and misleading audit reports for the years 2000 through 2002, assisting Hibernia in its scheme. The audits allegedly overstated the same artificially inflated values that were reported by Hibernia. The action alleges that PwC personnel were regularly present at Hibernia corporate headquarters, and had continual access to Hibernia's confidential corporate financial and business information. Because of this, the action alleges that PwC had an ongoing duty to report the GAAP violations committed by Hibernia.
Finally, the action alleges that individual defendants Oliver Murphy and Colm Delves engaged in illicit insider trading on September 28, 2000, when they sold more than $30 million in Hibernia stock, and engineered the sale of millions of additional shares of Hibernia securities by the company's convertible debt holders. The debt holders' ability to sell their Hibernia shares which they acquired upon acquisition of Hibernia's debt was allegedly critical to the defendants scheme-- as a result of Hibernia's inability to generate cash from operations sufficient to fund Hibernia's operations throughout the applicable period, it was critical to the defendants that the debt holders were also allowed to profit from the artificial inflation in the price of Hibernia securities.
If you purchased securities issued by Hibernia Foods during the applicable period, you may request appointment by the court as a lead plaintiff if you do so by August 13, 2004. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that your claim is typical of the claims of other class members, and that you will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiffs. Your ability to share in any recovery is not affected by the decision whether or not to serve as a lead plaintiff. You may retain any counsel of your choice to serve as you in this action, or you may choose to do nothing, and remain in the class as a silent member.
