A lawsuit was filed in the U.S. District Court for the Southern District of Texas on behalf of purchasers of Zapata Corp. (NYSE:ZAP) common stock between July 6, 1998 and October 15, 1998 by the law firm of Weiss &Yourman to recover damages caused by defendants' violations of the Securities Exchange Act of 1934.

The complaint alleges that defendants engaged in a plan and scheme to artificially inflate Zapata's stock price by materially misrepresenting to the investing public the business condition, strategy and future business prospects of Zapata. Specifically, the complaint alleges that the company announced and continued to reaffirm throughout the Class Period that the Company would become a major player in the internet. Announcements that a major acquisition was in the works, that the Company had secured letters of intent from dozens of other smaller websites, and that the home page ZAP.com was being refurbished doubled the Company's stock price literally overnight.
Suddenly, and without warning, Zapata announced that it was reconsidering its strategy and would not be honoring the letters of intent it had entered into with 31 internet companies. Plaintiff and the Class have been devastated by defendants' fraudulent scheme as alleged herein.

Update

On September 15, 1999, the court entered an order granting defendants' motion to dismiss the complaint, dismissing the entire action with prejudice.