Class Action Suit Filed Against Fluor Corporation and its Officers and Directors Alleging Misrepresentations and False Financial Statements.SAN DIEGO--(BUSINESS WIRE)--Sept. 15, 1997--A class action has been commenced in the United States District Court United States District Court In the U.S., any of the 94 trial courts of general jurisdiction in the federal judicial system. Each state, as well as the District of Columbia and the Commonwealth of Puerto Rico, has at least one federal district court. for the Central District of California on behalf of purchasers of Fluor Corporation ("Fluor") common stock during the period May 22, 1996 to Feb. 18, 1997. The complaint charges Fluor and certain of its officers and directors with violations of the federal securities laws. The complaint alleges a fraudulent scheme Noun 1. fraudulent scheme - an illegal enterprise (such as extortion or fraud or drug peddling or prostitution) carried on for profit illegitimate enterprise, racket and course of business by Fluor and certain of its top executives to artificially inflate Fluor's reported profits and the price of its common stock so that those top executives could collect millions of dollars of incentive and bonus compensation under Fluor's unique executive compensation plan which provided special bonus compensation to its top executives if, but only if, Fluor's profits met certain predetermined pre·de·ter·mine v. pre·de·ter·mined, pre·de·ter·min·ing, pre·de·ter·mines v.tr. 1. To determine, decide, or establish in advance: levels and its stock price traded at certain high levels as well. As a result of defendants falsifying fal·si·fy v. fal·si·fied, fal·si·fy·ing, fal·si·fies v.tr. 1. To state untruthfully; misrepresent. 2. a. Fluor's Fiscal 1996 ("F96") net income and earnings per share ("EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ") and their false and misleading statements, assuring investors that the "re-engineering and restructuring" of Fluor's largest and most important business unit, the Fluor Daniel Engineering and Construction ("E&C") unit had succeeded, that the Fluor Daniel E&C unit's expansion was succeeding and its business was very strong, Fluor reported record net income and EPS of $268 million and $3.17 for F96 ended Oct. 31, 1996. Defendants also assured investors that the success of the Fluor Daniel E&C unit would enable Fluor to meet its 15%-20% per year growth target in F97 to end Oct. 31, 1997, leading to sharply increased EPS for Fluor in F97 and F98. As a result, Fluor's stock climbed to an all-time high of $75-7/8 on Feb. 18, 1997, and Fluor's top executives collected millions in special incentive and bonus compensation for F96. However, after close of trading on Feb. 18, 1997, defendants stunned the markets by revealing that Fluor's actual operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before for the 1stQ F97 -- the quarter ended Jan. 31, 1997 -- were much worse than earlier forecast, in significant part due to huge cost overruns on two Fluor Daniel E&C units' fixed-price power plant construction projects which Fluor refused to identify or quantify, as well as soaring overhead costs overhead costs see fixed costs. in its Fluor Daniel unit. Fluor's common stock collapsed from over $75 to $62 on huge volume of 6.7 million shares, the largest one-day price decline on the largest one-day trading volume Trading volume The number of shares transacted every day. As there is a seller for every buyer, one can think of the trading volume as half of the number of shares transacted. That is, if A sells 100 shares to B, the volume is 100 shares. in Fluor's history -- thus wiping out in one trading day In Business, the trading day is the time span that a particular stock exchange is open. For example, the New York Stock Exchange is, as of 2006, open from 09:30AM to 4:00PM. Trading days never take place on weekends. approximately $1 billion of Fluor common share holder market value. Plaintiff seeks to recover damages on behalf of all purchasers of Fluor common stock during the Class Period (the "Class"). The plaintiff is represented by several law firms, including Milberg Weiss Bershad Hynes & Lerach LLP LLP - Lower Layer Protocol , who have expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud. Milberg Weiss has been actively engaged in commercial litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , emphasizing securities and antitrust class actions, for more than 20 years. The firm has offices in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , San Diego, San Francisco and Los Angeles and is active in major litigation pending in federal and state courts throughout the United States. The firm's reputation for excellence has been recognized on repeated occasions by courts which have appointed the firm to major positions in complex multi-district or consolidated litigations. Milberg Weiss has taken a lead role in numerous important actions on behalf of defrauded investors, and has been responsible for a number of outstanding recoveries which, in the aggregate, total approximately $2 billion. Visit the firm's website at http://www.milberg.com . If you are a member of the Class described above, you may, no later than 60 days from today, move the Court to serve as lead plaintiff of the Class, if you so choose. In order to serve as lead plaintiff, however, you must meet certain legal requirements. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, William Lerach, Alan Schulman or Darren Robbins of Milberg Weiss at 800/449-4900 or via e-mail at wsl@mwbhl.com . CONTACT: Milberg Weiss Bershad Hynes & Lerach LLP William Lerach/Alan Schulman/Darren Robbins, 800/449-4900 wsl@mwbhl.com |
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