Scott+Scott, LLC Announces Class Action Lawsuit Against Cray Inc.
May 24 2005 - 8:05PM
PR Newswire (US)
Scott+Scott, LLC Announces Class Action Lawsuit Against Cray Inc.
COLCHESTER, Conn., May 24 /PRNewswire/ -- Scott+Scott, LLC
(http://www.scott-scott.com/) filed a class action in the United
States District Court for the District of Washington on behalf of
the purchasers of Cray Inc. (Nasdaq: CRAYE; "Cray" or the
"Company") securities between July 31, 2003 and May 12, 2005,
inclusive (the "Class Period"). If you wish to serve as lead
plaintiff, you must move the Court no later than 60 days from
today. If you wish to discuss this action or have questions
concerning this notice or your rights, contact Scott+Scott
attorneys Neil Rothstein or Amy Saba in the firm's San Diego office
( or 800/332-2259). Plaintiff alleges that during the Class Period,
Cray failed to disclose and misrepresented material adverse facts
which were known to defendants or recklessly disregarded by them,
including: (1) that business metrics having a direct bearing on
revenue recognition, including the speed and costs of on- site
acceptance testing or improved processes for building machines in
accordance with customer requirements, were increasingly
unfavorable and unlikely to improve anytime soon (2) manufacturing
processes internal controls and testing were flawed and
ineffective; (3) Cray's own auditors and Audit Committee knew of
the flawed and ineffective internal controls; (4) delays in
inventory recognition realization and revenue were a recurring and
unpredictable feature of Cray's business model; and (5) Cray was
losing money or breaking even on certain customer orders. On May 9,
2005, Cray revealed that it had failed to include an auditor's
opinion on management's assessment of internal control over
financial reporting. Moreover, Cray continued to report revenue
results adversely impacted by faulty internal controls and past
quarter practices. In response, Cray's stock price fell $0.74 per
share over a three-day period ending May 12, 2005 -- an astonishing
35.6% loss -- to close at $1.34 on 9.5 million shares combined
volume. Connecticut-based Scott+Scott, LLC, with additional offices
in Ohio and California, practices nationwide, currently litigating
major securities, antitrust and employee retirement plan cases
throughout the United States. Scott+Scott is committed to client
communication and satisfaction. The firm represents pension funds,
charities, foundations, individuals and other entities worldwide in
both class and non-class actions. Please visit the Scott+Scott
website at http://www.scott-scott.com/ to learn more about the
firm, its practice and other cases. This release is issued in
accordance with the applicable U.S. federal law. DATASOURCE:
Scott+Scott, LLC CONTACT: Neil Rothstein or Amy Saba, Attorneys of
Scott+Scott, LLC, +1-800-332-2259, Web site:
http://www.scott-scott.com/
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