ATLANTA, March 25, 2003 (PRIMEZONE) -- Holzer Holzer & Cannon, LLC announced today that it has filed a class action lawsuit in the United States District Court for the Northern District of Georgia, on behalf of purchasers of AFC Enterprises, Inc. ("AFC" or the "Company") (Nasdaq:AFCE) publicly traded securities during the period between March 2, 2001 and March 24, 2003, inclusive (the "Class Period"). A copy of the complaint is available from the Court or by contacting Holzer Holzer & Cannon, LLC (toll-free) at (888) 508-6832 or by sending an e-mail to info@holzerlaw.com.
The complaint alleges that, during the Class Period, AFC and certain of its officers violated the federal securities laws by disseminating materially false and misleading statements and/or concealing material adverse facts, thereby artificially inflating the price of AFC securities.
Specifically, the complaint alleges that defendants failed to disclose and/or misrepresented the following material adverse facts that were then known to defendants or recklessly disregarded by them: (a) that the Company was improperly accounting for the value of certain long-lived assets, thereby artificially inflating its operating results; (b) that the Company was improperly accounting for the sale of corporate-owned stores to franchisees, thereby artificially inflating its operating results; (c) that the company was improperly accounting for cooperative advertising costs, thereby understating its advertising expenses and artificially inflating its operating results; (d) that the Company's Seattle Coffee Company was improperly accounting for inventory, sales allowances and slotting fees; and (e) as a result of the foregoing, the Company's financial statements published during the Class Period were not prepared in accordance with Generally Accepted Accounting Principles and, therefore, it was not true that the Company's financial statements were a "fair presentation" of the Company's financial position.
On March 24, 2003, as alleged in the complaint, after the close of the market, AFC shocked the investing public by announcing that it would be restating its financial statements for fiscal year 2001 and the first three quarters of 2002. Additionally, the complaint alleges, AFC also reported that it was examining whether its financial statements for fiscal year 2000 should be restated as well. The complaint alleges that in response to this negative announcement, the price of AFC common stock dropped precipitously - falling to as low as $12.30 per share - on extremely high trading volume.
If you bought AFC publically traded securities between March 2, 2001 and March 24, 2003, inclusive, and you wish to serve as a lead plaintiff, you must move the Court no later than May 27, 2003. In order to serve as a lead plaintiff, however, you must meet certain legal requirements. If you have any questions about how you may be able to recover your losses, or if you would like to consider serving as one of the lead plaintiffs in this lawsuit, you are encouraged to contact the firm.
Holzer Holzer & Cannon, LLC has substantial experience representing investors in securities fraud class actions such as this. Holzer Holzer & Cannon, LLC is located in Atlanta, Georgia, but represents investors in securities class action lawsuits throughout the country.