Bernstein Litowitz Berger and Grossmann LLP Announces Unprecedented Appointment as Co-Lead Counsel For Plaintiffs in Securities Fraud Litigation Against Lucent Technologies, Inc.

Business & Legal Editors

NEW YORK & SAN DIEGO--(BUSINESS WIRE)--July 2, 2001

The following is an announcement by the law firm Bernstein Litowitz Berger and Grossmann LLP:

In an Order dated June 12, 2001, the Honorable Alfred J. Lechner, Jr. of the United States District Court for the District of New Jersey selected Bernstein Litowitz Berger and Grossmann LLP to serve as Plaintiffs' Co-Lead Counsel in In Re Lucent Technologies, Inc. Securities Litigation, a securities fraud class action on behalf of purchasers of the common stock of Lucent Technologies, Inc. (NYSE: LU) from October 26, 1999 through December 21, 2000.

The Plaintiffs allege that, during the Class Period, Defendants made materially false and misleading statements regarding Lucent's optical networking business and reported financial results that were false and inflated. Indeed, Lucent press releases in November and December 2000 acknowledge that Lucent had improperly recognized approximately $700 million in revenues for fiscal year 2000 and that it had notified the SEC of these revenue recognition violations.

The appointments of Co-Lead Plaintiff and Co-Lead Counsel are especially noteworthy as they mark the first time since the 1995 passage of the Private Securities Litigation Reform Act that a court has reopened the lead plaintiff and lead counsel selection process to account for changed circumstances, new issues and possible conflicts between new and old allegations. In point of fact, the initial Class Period, as originally plead, was approximately 11 weeks while subsequent evidence and evaluation of the case have extended it to 14 months.

In the first quarter of 2000, 18 class actions complaints were filed against Lucent and its officers and the actions were consolidated as "Lucent I". Under an April 27, 2000 Order, the Employer-Teamsters Locals 175 & 505 Pension Trust Fund was appointed provisional Lead Plaintiff. Thereafter, a sealed bid auction was held to select Lead Counsel and a law firm was appointed Lead Counsel by the court. On November 3, 2000, based on the evidence developed to that point, Lead Plaintiff filed an amended consolidated complaint alleging a class period from October 26, 1999 through January 6, 2000.

Lucent then issued two press releases on November 21, 2000 and December 21, 2000, announcing that it had improperly recognized revenues. In the wake of these press releases, a number of other class action complaints were filed against Lucent ("Lucent II"). Lead Plaintiff also filed second, third and fourth amended consolidated complaints in response to these announcements which ultimately extended the class period from October 26, 1999 through December 21, 2000. On December 26, 2000, the court entered an Order consolidating the "Lucent II" complaints with the "Lucent I" action.

In January 4, 2001 letters to the Court, Bernstein Litowitz Berger & Grossmann LLP , counsel for Plaintiffs the Anchorage Police and Fire Retirement System and the Louisiana School Employees' Retirement System, and Cohen, Milstein, Hausfeld & Toll, PLLC, counsel for Plaintiffs Parnassus Income Trust and Equity Fund, requested that the December 26, 2000 Consolidation Order be vacated. The Court ultimately determined that an additional lead plaintiff and an additional lead counsel would benefit the class.

On April 17, 2001, the Court appointed the Parnassus Funds as Co-Lead Plaintiff in the action and ordered that there be a competitive bid to determine Co-Lead Counsel for the action. In response to the Court's Order, 17 law firms from across the country submitted proposals to serve as Co-Lead Counsel. In its June 12, 2001 Order, the Court held that Bernstein Litowitz Berger & Grossmann, LLP's proposal was the strongest bid and specifically noted the firm's expertise in securities class actions and the time and effort that the firm spent evaluating the case.

The Co-Lead Plaintiff and Co-Lead Counsel appointments in this litigation will clearly impact the prosecution of future securities actions. Max Berger, senior partner of Bernstein Litowitz Berger & Grossmann LLP, stated that "we are delighted at the court's decision to appoint additional lead plaintiffs and lead counsel as, in the spirit of the PSLRA, it will enable the appropriate institutional investors to better prosecute the allegations in this complex case."