NEW YORK, May 7, 2002 (PRIMEZONE) -- Pomerantz Haudek Block Grossman & Gross LLP (www.pomerantzlaw.com) has filed a class action charging Merrill Lynch & Co., Inc. ("Merrill Lynch") (NYSE:MER), its former Internet research analyst Henry M. Blodget ("Blodget") and its research analyst Virginia Syer Genereux ("Genereux") with issuing false and misleading research reports about Aether Systems, Inc. ("Aether" or the "Company") (Nasdaq:AETH) in violation of Sections 10(b)of the Securities Exchange Act of 1934.
The case (02 CV 3513) was filed in the United States District for the Southern District of New York, United States Courthouse, 40 Centre Street, New York, NY 10007, on behalf of investors who purchased the common stock of Aether during the period from November 15, 1999 through February 20, 2002, inclusive (the "Class Period").
The Complaint charges that, during the Class Period, defendants' research reports and ratings on Aether were neither independent nor objective, but instead were biased and improperly influenced by Merrill Lynch's lucrative investment banking relationships with this important client. It is also alleged that at the time defendants were issuing positive ratings and coverage about Aether, they were concealing their contemporaneous, private negative assessments of the Company. Indeed, Merrill Lynch's research reports on Aether were so tainted that Blodget internally acknowledged, in a December 1, 2000 e-mail, the need to, "just start calling the stocks ..., including AETH (Aether) like we see them, no matter what the ancillary business consequences are." Plaintiff asserts that despite this telling concession, neither Blodget nor the other defendants started calling Aether stock as they saw it.
The Complaint further alleges that defendants failed to disclose that although Merrill Lynch technically had five ratings, it had a policy and practice of assigning only its top three ratings (buy, accumulate, and neutral) to Internet companies. During the relevant time herein, defendants not once issued Merrill Lynch's two lowest ratings -- reduce or sell -- on such companies, including Aether.
As a result of defendants' false and misleading statements, the market price of Aether common stock was artificially inflated, maintained or stabilized during the Class Period.
On April 8, 2002, New York State Attorney General Eliot Spitzer (the "Attorney General") announced that a ten-month investigation had revealed that Merrill Lynch's "supposedly independent and objective investment advice was tainted and biased by the desire to aid Merrill Lynch's investment banking business." Merrill Lynch's ratings on Aether were among those challenged by the Attorney General. Since then, the Attorney General has reportedly reached an interim settlement with Merrill Lynch requiring it to make more meaningful disclosures of its investment banking relationships with companies on which it issues research reports, but larger issues relating to possible payment of restitution and even criminal charges are still unresolved. The Securities and Exchange Commission and certain states have now announced their own investigations of Merrill Lynch.
If you purchased the common stock of Aether during the Class Period, you have until July 2, 2002 to ask the Court to appoint you as lead plaintiff for the Class. To serve as lead plaintiff, you must meet certain legal requirements. If you wish to review a copy of the Complaint, to discuss this action or have any questions, please contact Andrew G. Tolan, Esq. of the Pomerantz firm at 888-476-6529 (or (888) 4-POMLAW), toll free, or at agtolan@pomlaw.com by e-mail. Those who inquire by e-mail are encouraged to include their mailing address and telephone number.
The Pomerantz firm, which has offices in New York and Chicago, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz firm pioneered the field of securities class actions. Today, more than 50 years later, the Pomerantz firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members.
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