A class action lawsuit was filed in the United States District Court for the Central District of California on behalf of purchasers of Endocare, Inc. (NASDAQ:ENDO), common stock between October 23, 2001to October 30, 2002, inclusive (the "Class Period").
The Complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10-b(5). The action arises from damages incurred by the Class as a result of a scheme and common course of conduct by defendants which operated as a fraud and deceit on the Class during the Class Period.
Endocare is a medical device company focused on the development of urological healthcare technologies. The complaint alleges that during the Class Period, defendants caused Endocare's shares to trade at artificially inflated levels through the issuance of false and misleading financial statements. As a result of this inflation, Endocare was able to complete a public offering of 4 million shares, raising proceeds of $68 million on Nov. 16, 2001. On Oct. 30, 2002, the Company issued a press release entitled, "Endocare Will Delay Release of Third Quarter Results Until Completion of Its Review Process." On this news the stock dropped below $3 per share. As further alleged, due to defendants' deceptive and illegal conduct, plaintiff and the other class members purchased their Endocare securities at inflated prices and were damaged thereby.
This action seeks to recover damages on behalf of defrauded investors who purchased Endocare securities.

Update

The parties have reached a tentative settlement. Proof of claim forms are not yet available. More details to follow.