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Red Hat hit with class-action lawsuits (Triangle Business Journal)
Yesterday, Red Hat said it would make minor tweaks to the way it accounts
for subscription revenue. Today, the Triangle Business Journal reports,
at least two law firms have filed class-action shareholder lawsuits against
the company. "The precipitous drop didn't escape the attention of
Atlanta-based Chitwood & Harley LLP and New York-based Goodkind Labaton
Rudoff & Sucharow LLP, which announced in separate press releases Wednesday
that they had filed class-action suits against Red Hat and some of its
executives. According to the press releases, the law firms accuse Red Hat
of defrauding its investors by reporting false and misleading financial
information."
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Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 15, 2004 5:33 UTC (Thu) by DaleQ (subscriber, #4004) [Link] I love this kind of American "justice".Let's see, I'm a shareholder in RHAT. I want the mangement to run the company to the best of their abilities. But instead, they are distracted by the lawsuit(s). Let's say the lawyers win and then I (a shareholder) pay $1.00 to satisfy the suit. Then, I (a shareholder) receive $0.50 which is all that is left after lawyer fees ($0.33) and administration costs ($0.12). Sheesh, who wins here?
Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 15, 2004 8:17 UTC (Thu) by ekj (subscriber, #1524) [Link] Sure. In any suit the lawyers are guaranteed winners. Regardless of merit, they get paid.I agree, it's annoying, but there's not much you can do about it. In the medium term it likely won't matter anyway, what will matter is Redhats ability to continue to grow, and to operate profitably.
Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 15, 2004 10:20 UTC (Thu) by genius (guest, #19981) [Link] Red Hat shareholder = loser!Sucker!
Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 15, 2004 13:14 UTC (Thu) by huffd (guest, #10382) [Link] RHAT seems to have an accountablity problem, or the SEC wouldn't have gotten involved. If the stocks hadn't dropped there wouldn't have been any class action lawsuits. The stock holders are using the lawsuit to write off losses against their stock losses. The real profit from this is the public disclosure. When your CFO resigns and three days later you rewrite how you accounted for prior earnings, folks you have a problem.
Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 15, 2004 17:07 UTC (Thu) by smoogen (subscriber, #97) [Link] No the SEC does regular audits of many more corporations these days than they did before the last meltdown. I know of a several small corporations that are having to make changes to accounting methods that were acceptable in 2002 but arent now.Actually they seem to do a lot of audits and questions of Microsoft rivals.. [Now hows that for hearsay... and prejudgement.]
Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 22, 2004 16:04 UTC (Thu) by stock (subscriber, #5849) [Link] "Sheesh, who wins here? "Heh, The Law Firms , you stupid! :)
Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 22, 2004 16:12 UTC (Thu) by stock (subscriber, #5849) [Link] [ CONSPIRACY mode :ON: ]RedHat being very successfull on Wallstreet is a dagger in the harts of certain Corporations. Why not sneak a rotten CFO into the board of RedHat and allow RedHat to make ridiculous mistakes ? [ CONSPIRACY mode :OFF: ]
Red Hat hit with class-action lawsuits (Triangle Business Journal) Posted Jul 15, 2004 13:12 UTC (Thu) by anamana (subscriber, #2787) [Link] If you've ever noticed this kind of thing with other companies, you'll see a group of lawyers 'chasing the ambulance' and buried in their press release is a note basically saying "we're looking for people to be in the class" - i.e. their suing without any plaintifs. The suit may go to nothing, since it can't progress without someone in the 'class', but it makes good press... (btw, I'm not even close to being a lawyer..)
Get the facts, then judge Posted Jul 15, 2004 13:46 UTC (Thu) by dowdle (subscriber, #659) [Link] People always try to connect the dots when there aren't always realconnections. 1) Yes, RHAT's CFO did resign. It is quite possible he did so for the reason he stated. 2) As a result of #1 above, someone else took over, right? Maybe it is a temporary person until they get a shiny, new CFO, I don't know... but often, different people do things differently... and the change might be a result, not of something the previous CFO did wrong, but of the preferred way the new person has. 3) I'm not aware of any significant alteration to their actual earnings figures caused by this alteration in reporting strategies... but I am not a lawyer nor am I a financial management executive. As I understand the little I've read, they are just shifting the month something was reported on... so it appears later rather than sooner. The figures really haven't changed and if the stock took a hit, it is a temporary blip of little consequence. Their stock will rebound and continue to grow modestly... or at least that is my hope. 4) Is there anyone who actually believes that Red Hat was falsifying their reporting information? I'm not aware of anyone. 5) Law suits are coming people. There is nothing to do to avoid them. There are some entities out there who are using their network of contacts and partner businesses to gear up for a legal battle... in an effort to tie up / exhaust large sums of money and drain the resources of smaller companies... especially Red Hat. Eric S. Raymond told us to expect them... and he is just one voice. The good thing is that Red Hat has a bunch of money borrowed / saved up that they can use for legal action. It would be a shame if they have to eventually waste a couple hundred million dollars to fight one or two shadow enemy companies (and we know who they are) but if that is a fight we have to take on (and Red Hat isn't going to be the only company that gets hit) to ensure the progression of Free Software and the Open Source development model, so be it... that's how these United States of America work... unfortunately. There may be a time where the community has to step in and defend themselves as well... and / or stand up for the companies they want to see survive. 6) If you fall for the illusion of the validity of some of these law suits (take SCO for example and all of the suits they have put forth thus far) and nag about the companies dealing with the suits (take Red Hat for example), you aren't helping. 7) Some of the folks at Red Hat said that when their stock took off immediately and the company was worth a fortune on paper, that it was NOT a good thing for the company. They don't want to play the market and get rich that way. They'd rather be a valid business with stock priced reasonably... with a survivable, long-term growth strategy... they ARE NOT building a house of cards. RHAT believes in the long-term viability of Open Source software and the enormous potential and opportunity that exists in that market space... particularly with Linux. If you are going to bad mouth Red Hat, you are bad mouthing one of the most Linux supportive companies there is -- look at the developers they employ for goodness sakes... get a clue. If you don't like their business model, debate that... but don't gripe at a company doing most of the things it should... that other companies can't even afford to do.
Get the facts, then judge Posted Jul 15, 2004 16:39 UTC (Thu) by huffd (guest, #10382) [Link] And if RHAT was in the wrong? Do you suggest we just set aside our morals along with our better judgement as you suggest? In the name of OSS of course..
Get the facts, then judge Posted Jul 15, 2004 17:03 UTC (Thu) by smoogen (subscriber, #97) [Link] No. But if you believe in 'Innocent until Proven Guilty' you should wait until a jury decides so. Or you could be like everyone else and get the pitchforks and torches to burn a bunch of people who tried to make money off of Free Software.
Get the facts, then judge Posted Jul 16, 2004 6:33 UTC (Fri) by dowdle (subscriber, #659) [Link] Did you read the subject I put on my comments? Get the facts, then judge.That's all I'm asking. In no way was I saying to ignore misdeeds if and when they are proven to have happened. I'll believe it when I see it. The POINT of my posting was that we will probably see a few dozen totally baseless lawsuits spring up over the next year or so... that only aim to make companies waste all their money showing that they are in fact innocent... and the people backing the legal action know they are innocent... they just want the defendent to exhaust as many of their resources possible.
Get the facts, then judge Posted Jul 17, 2004 16:58 UTC (Sat) by huffd (guest, #10382) [Link] I am fully aware of what you implied.4) Is there anyone who actually believes that Red Hat was falsifying their reporting information? I'm not aware of anyone. This is the 17th and already 10 different law firms have filed lawsuits. The weight of your statements is teetering on the precipice belligerent ignorance.
Where are these people with SCO? Posted Jul 15, 2004 16:59 UTC (Thu) by Ross (subscriber, #4065) [Link] SCO has given so many more misleading statements, and done so much more topull money away from their shareholders. Why are they being sued by their shareholders?
Where are these people with SCO? Posted Jul 15, 2004 17:08 UTC (Thu) by smoogen (subscriber, #97) [Link] Follow the money to the Law Firms....
Where are these people with SCO? Posted Jul 15, 2004 17:23 UTC (Thu) by justme (guest, #19967) [Link] There's no blood in that turnip. RHAT, on the other hand has amassed enough cash to make a suit worthwhile.Also, follow the money even beyond the law firms to the birdies whispering in the law firm's ears.
[OT] Lawfirm names Posted Jul 15, 2004 17:13 UTC (Thu) by rjamestaylor (guest, #339) [Link]
It could only be better if the suits were brought by Dewey, Cheetum & Howe. Where is the "gratuity" given by the stockholders who benefited from the market's assumption-based panic? Hmmm. (I don't hold RHAT nor do I work for RHAT)
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