LITTLE ROCK, Ark., Feb. 7, 2001 (PRIMEZONE) -- The Law Firm of Cauley Geller Bowman & Coates, LLP announced today that it has filed a class action in the United States District Court for the Central District of California, on behalf of all individuals and institutional investors who purchased the common stock of Guess? Inc. ("Guess" or the "Company") (NYSE:GES) between February 14, 2000 and January 26, 2001, inclusive (the "Class Period").
The Complaint alleges that defendants violated the federal securities laws by making false and misleading statements during the Class Period. Specifically, the complaint charges Guess and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that as Guess' inventory increased during the Class Period, the price of Guess shares fell from the $28-$33 range to the $18-$20 range, and it became obvious to defendants that they could not successfully complete the sale of 4.5 million shares in their planned secondary offering for expected returns of approximately $120 million (or approximately $27 per share). Therefore, according to the complaint, defendants embarked on a campaign to conceal the adverse financial condition of the Company and thereby avoid a complete collapse in the price of Guess shares.
On Nov. 9, 2000, after defendants had sold over $2.2 million of their own Guess shares, they revealed that in the 3rdQ fiscal 2000 ("F00") Guess would earn only $0.13 per share compared to analysts' revised estimates of $0.33 per share ($0.45 unrevised), that in the 4thQ F00 the Company would earn only $0.08 per share compared to an estimated of $0.44 per share (unrevised), and for F01 $0.95 per share compared to $1.85 per share (unrevised). In addition, and for the first time, defendants also revealed that Guess would record a loss of over $4.7 million related to below cost sales of inventory, and an additional charge of $5.4 million to increase reserves for impaired or worthless inventory.
As further alleged in the complaint, the Nov. 9, 2000 press release was defendants' attempt to effectuate a "soft landing" (i.e., avoid a complete collapse in Guess stock) and was a precursor of things to come. On Jan. 26, 2001, the Company issued a press release in which it admitted that, throughout the Class Period, it had artificially and improperly inflated its earnings by failing to expense costs or record accruals relating to the value of its substantially impaired inventory. As a result of the Company's accounting improprieties, Guess was forced to restate its financial results for the 1stQ, 2ndQ and 3rdQ of fiscal 2000.
Cauley Geller Bowman & Coates, LLP has substantial experience representing investors in securities fraud class action lawsuits such as this. The firm has offices in Florida, Arkansas and California, but represents shareholders from throughout the nation. If you have any questions about how you may be able to recover for your losses, or if you would like to consider serving as one of the lead plaintiffs in this lawsuit, you must meet certain requirements and take appropriate action by April 2, 2001. You are encouraged to call or e-mail the Firm or visit the Firm's Website at www.classlawyer.com.
CAULEY GELLER BOWMAN & COATES, LLP Client Relations Department: Sue Null, Charlie Gastineau or Jackie Addision 11311 Arcade Drive, Suite 200 Toll Free: 1-888-551-9944 E-mail: info@classlawyer.com
More information on this and other class actions can be found at www.primezone.com/ca