Stockholders v Ramp Networks, Inc.
Ramp Networks' Stockholders Recover $6.9 Million
The parties have reached a tentative $6.9 million settlement of a class action filed against Ramp Networks, Inc. (formerly Nasdaq: RAMP) and certain of its officers and directors by stockholders who purchased the company's common stock between January 24 and September 29, 2000. 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. To recover under the settlement, a completed proof of claim postmarked no later than January 20, 2004, must be mailed to the claims administrator.
The action claims that Ramp materially overstated its financial results by violating financial accounting standards. Specifically, the action alleges that Ramp improperly recorded revenue for transactions with distributors and resellers when Ramp could only collect the revenues if and when those distributors and resellers could successfully sell Ramp products to end users, and for transactions where Ramp was likely to have its products returned.
The settlement will not be effective until the court grants it final approval. The court has scheduled a hearing on the matter for November 14, 2003.
