Berman DeValerio & Pease Announces Class Action Lawsuit Against FreeMarkets, Inc.

Business Editors & Legal Writers

PITTSBURGH--(BUSINESS WIRE)--May 3, 2001

Berman DeValerio & Pease Pursues FreeMarkets, Inc. For

Defrauding Investors

Shareholders are pursuing a federal class action charging FreeMarkets, Inc. (Nasdaq: FMKT) with securities fraud, the law firm of Berman DeValerio & Pease said today.

The lawsuit was filed April 27 in the United States District Court for the Western District of Pennsylvania and is captioned Pehrson v. FreeMarkets, Inc. et al., Civil Action No. 01:0746. It seeks damages for violations of federal securities laws on behalf of all investors who bought FreeMarkets common stock between July 24, 2000 and April 23, 2001 (the "Class Period").

Berman DeValerio & Pease has represented investors in class actions for nearly two decades. To review the complaint and learn more about becoming a lead plaintiff, visit our Website at www.bermanesq.com.

FreeMarkets is charged with improperly accounting for its financial results for the second, third and fourth quarters and the year of fiscal 2000. In reporting its financial results during the Class Period, the company failed to properly account for a warrant that it had provided to one of its largest customers, Visteon Corporation ("Visteon"). Consequently, FreeMarkets reported artificially inflated revenues during the Class Period. On April 23, 2001, FreeMarkets revealed that the Securities and Exchange Commission staff had informed the company that its payments from Visteon should not be classified as revenue, but as money paid for the warrant. As a result, absent an appeal to the full SEC, the company said it would amend its financial statements to eliminate all the revenue it had received from Visteon during the Class Period. FreeMarkets' stock price fell from a close of $10.29 per share on April 23, 2001 to $9.30 on April 24, 2001.

The suit names FreeMarkets' chief executive officer and chief financial officer as defendants. These officers are charged with collectively selling thousands of shares of FreeMarkets common stock during the Class Period for more than $17 million.

If you purchased FreeMarkets, Inc. common stock during the period of July 24, 2000 through April 23, 2001, you may wish to contact the following attorneys at Berman DeValerio & Pease to discuss your rights and interests:

Alicia M. Duff, Esq.

Jeffrey C. Block, Esq.

Berman DeValerio & Pease LLP 

One Liberty Square

Boston, MA 02109

[e-mail]

[phone]

You may also visit us at our website at www.bermanesq.com.

If you wish to apply to be lead plaintiff in this action, a motion must be filed on your behalf with the court no later than June 26, 2001. You may contact the attorneys at Berman DeValerio & Pease to discuss your rights regarding the appointment of lead plaintiff and your interest in the class action. To be a member of the class, however, you need not take any action at this time and you may retain counsel of your own choice. If you decide to seek appointment as lead plaintiff, you may also retain counsel of your choice.

With offices in Boston and San Francisco, Berman DeValerio & Pease has prosecuted shareholder class actions since 1982, recovering more than $1 billion for investors. The firm has acted as lead counsel in numerous lawsuits involving violations of federal securities laws. It has successfully litigated these actions, and has been singled out for its excellence by many courts. The firm prides itself on its responsiveness to shareholders and their needs in each case.