Gemstar-TV Guide Int., Inc. (Nasdaq: GMST), a media technology company based in Los Angeles, has announced the preliminary settlement of the securities class action pending against the company in the C.D. of Cal. The suit is based on alleged misrepresentations made in connection with Gemstarís accounting for certain transactions that were subsequently restated between November 2002 and March 2003. The settlement does not include the individual defendants in the class action or the related derivative cases that have been brought against the company.
The settlement, which is subject to court approval, is for $67.5 million, which will be paid in cash and stock. Gemstar will pay an aggregate of $42.5 million in cash to the class in a combination of direct payments and, interestingly, payments which may be made through the SEC. In addition, the company will issue 4,105,090 shares of common stock which was valued at $6.09 per share on the date the agreement was reached, or $25 million in the aggregate (this stock issuance is subject to possible adjustments related to share price). Gemstar will also assign to the plaintiffs certain of its claims against its former auditors, KPMG.Posted by Lyle Roberts at February 13, 2004 3:29 PM | TrackBack