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From: Agirl
T1:
Category: Northwest News
Date: 21 Dec 2005
Time: 10:15:31 -0500
Remote Name: 205.188.116.198
Northwest Airlines' Executives Sued Suit Alleges Executives had insider information and made misleading statements.
The following press release was issued December 20, 2005 04:15 PM US Eastern Timezone
Milberg Weiss Announces That It Today Filed a Class Action Suit against Certain Officers and Directors of Northwest Airlines Corp. on Behalf of Investors
NEW YORK--(BUSINESS WIRE)--Dec. 20, 2005--The law firm of Milberg Weiss Bershad & Schulman LLP announces that it today filed a class action lawsuit on behalf of purchasers of the securities of Northwest Airlines Corp. ("Northwest" or the "Company") (OTC:NWACQ) between April 21, 2005 and September 14, 2005 inclusive (the "Class Period") seeking to pursue remedies under the Securities Exchange Act of 1934 (the "Exchange Act").
The action, numbered 05-CV-10653, is pending before the Honorable Richard J. Holwell in the United States District Court for the Southern District of New York against defendants Alfred A. Checchi (Director), Bernard L. Han (CFO), Douglas M. Steenland (CEO, President and Director) and Gary L. Wilson (Chairman). Northwest is not named as a defendant in this action solely because it is in chapter 11 bankruptcy. A copy of the complaint filed in this action is available from the Court and can be retrieved from the clerk's office and various services, or can be viewed on Milberg Weiss's website at: http://www.milbergweiss.com (or link to the suit below).
The complaint alleges, among other things, that certain Northwest insiders sold their Northwest securities for proceeds in excess of $30 million while in possession of nonpublic information regarding Northwest's plans to file for chapter 11 bankruptcy. The complaint further alleges that defendants made materially false and misleading statements, throughout the class period, with respect to Northwest's prospects. Specifically, the complaint alleges, defendants maintained that Chapter 11 bankruptcy was "a possibility" and that the Northwest might have "to consider" filing for bankruptcy if certain conditions were not met. The complaint further alleges that defendants' statements were materially false and misleading not only because defendants failed to disclose that the Company's Chapter 11 bankruptcy filing was already imminently anticipated and being planned for, but also because they failed to disclose that filing for Chapter 11 protection was, in fact, a strategy that defendants had adopted at least as early as April 2005 because they viewed bankruptcy reorganization as the only way to dump the crushing burden of Northwest's pension obligations on the Pension Benefit Guaranty Corp., impose their will upon Northwest's union to obtain givebacks of at least $1.1 billion, and thereby compete with lower-cost discount carriers such as JetBlue Airways, and so-called "legacy" rivals such as UAL Corp. and US Airways Group Inc., that had already offloaded their pension obligations and otherwise achieved significant savings through bankruptcy reorganization.
The Company, on September 14, 2005, announced that it had filed a voluntary petition for relief under Chapter 11, title 11, United States Code, 11 U.S.C. sections 101, et seq. (the "Bankruptcy Code"). On this news the Company's shares, which had been trending downward, fell from a closing price of $1.87 on September 14, 2005 to an opening price of $0.86 on September 15, 2005. The stock was delisted on September 26, 2005 but continued to trade over-the-counter as a penny stock. As a result of defendants' wrongful acts and omissions, and this material erosion and decline in the market value of Northwest securities, plaintiffs and other class members who purchased such Northwest securities during the Class Period have suffered significant losses and damages.
The complaint further alleges that, during the months preceding the bankruptcy, insiders sold their Northwest shares to unwitting investors for proceeds in excess of $30 million under highly suspicious circumstances that raise the inference that, at the time of the sales, defendants had material nonpublic information that the Company had already planned to file for bankruptcy and that the filing was imminently expected.
If you bought the securities of Northwest between April 21, 2005 and September 14, 2005, and sustained damages, you may, no later than 60 days from the date of this notice, request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Milberg Weiss Bershad & Schulman LLP, or other counsel of your choice, to serve as your counsel in this action.
Milberg Weiss Bershad & Schulman LLP (http://www.milbergweiss.com is a firm with over 120 lawyers with offices in New York City, Los Angeles, Boca Raton, Delaware and Washington, D.C. and is active in major litigations pending in federal and state courts throughout the United States. Milberg Weiss has taken a leading role in many important actions on behalf of defrauded investors, consumers, and others for nearly 40 years. Please contact the Milberg Weiss website for more information about the firm. If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following attorneys:
Contacts:
Steven G. Schulman
Peter E. Seidman
Andrei V. Rado
One Pennsylvania Plaza, 49th fl.
New York, NY, 10119-0165
Phone number: (800) 320-5081
Email: sfeerick@milbergweiss.com
Website: http://www.milbergweiss.com