LITTLE ROCK, Ark., Sept. 10, 2002 (PRIMEZONE) -- The Emerson Firm, a securities class action trial law firm with offices in Houston and Little Rock, announces that a class action was filed on September 10, 2002, on behalf of purchasers of Fleming Companies, Inc. (NYSE:FLM) ("Fleming" or the "Company") common stock during the period between February 27, 2002 and July 30, 2002, inclusive (the "Class Period"). A copy of the complaint filed in this action is available from the Court, or can be obtained from the firm's Investor Relations Department by calling toll free 1-800-663-9817.
The action is pending before the Honorable John T. Ward in the United States District Court for the Eastern District of Texas, Texarkana Division, against defendants Fleming, Mark Hansen (CEO, Chairman), Neal J. Rider (CFO) and Thomas G. Dahlen (Executive FP, President of retail operations). John G. Emerson, Jr., a member of the bar for the United States District Court for the Eastern District of Texas for many years, is the attorney in charge for the plaintiff who filed the action.
The complaint alleges violations of Sections 10(b) and 20(a), of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Specifically, the suit alleges that beginning in early 2002, the defendants issued numerous positive statements regarding Fleming's "price-impact" retail supermarket division. These statements were made despite the fact that the defendants knew, or recklessly disregarded, that the performance of Fleming's "price-impact" retail supermarket division was, in the words of the defendants, "disappointing." These statements falsely portrayed Fleming's business prospects and artificially inflated and maintained the price of Fleming common stock. The defendants capitalized on their false and misleading statements by: 1) lowering the interest rate and extending the maturity on $250 million of Fleming's debt; 2) raising over $155 million through the June 13, 2002 sale of 8 million shares of Fleming common stock at $19.40 per share; 3) raising an additional $200 million through the June 13, 2002 sale of Fleming Notes due 2010; and 4) using the proceeds of the June 13, 2002 securities sales to complete the purchase of Core-Mark International, Inc. and Head Distributing for $330 million in cash -- acquisitions described by the defendants as "key" to Fleming's implementation of its strategic transformation into an efficient, national, multi-tier supply chain for consumer packaged goods.
Then, approximately six weeks after defendants sold $355 million worth of Fleming securities, Fleming announced after the close of trading on July 30, 2002 in an abrupt departure to the repeated and positive statements made by the defendants during the Class Period, that its "price-impact" retail supermarket division was not only performing poorly, but performing so poorly that Fleming was considering abandoning this line of business entirely. The price of Fleming common stock dramatically declined on this announcement, falling from $15.21 on July 30, 2002 to $13.75 on July 31, 2002, on huge trading volume of 3.9 million shares, and continued to decline over the next two heavy trading days to a 52-week low of $10.76 on August 2, 2002. Since then, the price of Fleming common stock has never recovered, and currently trades well below the $19.40 price at which Fleming sold 8 million shares to unsuspecting investors on June 13, 2002.
If you bought Fleming common stock between February 27, 2002 and July 30, 2002, inclusive, and you wish to serve as lead plaintiff, you must move the Court no later than October 28, 2002. Any member of the purported class may move the Court to serve as lead plaintiff through The Emerson Firm or other counsel of their choice.
The Emerson Firm has substantial experience representing investors in securities fraud class action lawsuits such as this and has handled many actions in the courts of the Eastern District of Texas. The firm has offices in Texas and Arkansas, but represents investors 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 are encouraged to call toll free or e-mail the Firm.
THE EMERSON FIRM
Investor Relations Department:
Ms. Tanya Autry
P.O. Box 25336
Little Rock, AR 72221-5336
Toll Free: 1-800-663-9817
E-mail: tanya.autry@worldnet.att.net
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.