Class Action Lawsuit Filed Against Legato On Behalf of Shareholders Who Purchased Common Stock Between October 20, 1999 and January 19, 2000.

Business Editors & Legal Writers

NEW YORK--(BUSINESS WIRE)--March 3, 2000

The following is an announcement by the law firm of Pomerantz Haudek Block Grossman & Gross LLP:

A class action lawsuit was filed by Pomerantz Haudek Block Grossman & Gross LLP (www.pomerantzlaw.com) against Legato Systems, Inc. ("Legato" or the "Company") (NASDAQ:LGTO) and two of the Company's senior officers. The complaint was filed on behalf of all those persons or entities who purchased the common stock of Legato during the period between October 20, 1999 and January 19, 2000, inclusive (the "Class Period").

According to the complaint, Legato allegedly issued a series of false and misleading statements which reportedly inflated earnings in a manner which violated Generally Accepted Accounting Principles ("GAAP"). In particular, the Company allegedly omitted to disclose in its financial statements that it was prematurely recording revenue from several potential contracts during the third and fourth quarters of 1999. The premature revenue recognition reportedly served to artificially inflate the common stock of Legato during the Class Period.

On January 19, 2000, the Company disclosed to the market that it had been improperly recognizing revenue. While the common stock of Legato was artificially inflated during the Class Period, the Company's senior executives allegedly sold over $15 million of their Legato shares while in possession of inside information. Following the disclosure, the price of Legato's common stock lost more than 40% of its value.

If you purchased Legato common stock during the Class Period, you have until March 20, 2000 to ask the Court to appoint you as one of the lead plaintiffs for the Class. In order to serve as lead plaintiff, you must meet certain legal requirements. If you wish to discuss this action or have any questions, please contact Andrew G. Tolan, Esq. of the Pomerantz firm at 888-476-6529 (or (888) 4-POMLAW), toll free, or at [e-mail] by e-mail. Those who inquire by e-mail are encouraged to include their mailing address and telephone number. The Pomerantz firm is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz firm pioneered the field of securities class actions. Today, over 50 years later, the Pomerantz firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion dollar damages awards on behalf of class members.

The Pomerantz firm's Senior Partner, Stanley M. Grossman, leads a team of legal professionals who litigate in courts throughout the United States. The Firm affiliates, as necessary, with other highly qualified counsel throughout the nation. Mr. Grossman, formerly president of the National Association of Securities and Commercial Attorneys, was recently invited to testify before the House Subcommittee on Courts and Intellectual Property concerning the Class Action Jurisdiction Act of 1998. Mr. Grossman aided congressional assistants in the drafting of this bill.