Cohen, Milstein, Hausfeld & Toll, P.L.L.C. Announces Filing of Consolidated Class Action Complaint on Behalf of Investors of LeapFrog Enterprises, Inc.

WASHINGTON -- The law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C. announced today that a consolidated class action complaint on behalf of purchasers of the securities of LeapFrog Enterprises, Inc. (NYSE:LF) ("LeapFrog" or the "Company") from July 24, 2003, through October 18, 2004, inclusive (the "Class Period"), was filed on June 17, 2005, in the United States District Court for the Northern District of California.

Notice of this filing was first announced on August 3, 2005, pursuant to a July 5, 2005 Court Order (the "July 5 Order"), a copy of which can be found at www.cmht.com. The July 5 Order was prompted by the fact that the consolidated class action complaint filed on June 17, 2005 (the "Consolidated Complaint") encompassed a substantially different class period and different allegations than the July 24, 2003 to February 10, 2004 class period for which the Court had previously appointed Alice Cupples and William Sullivan (the "Cupples Movants") as lead plaintiffs in an April 6, 2005 order. The new class period and allegations encompassed by the Consolidated Complaint include new allegations about LeapFrog's supply chain and IT system. Similar allegations about LeapFrog's supply chain and IT system had already been made in a different class action complaint filed on April 25, 2005 by the law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C. on behalf of the Parnassus Fund and the Parnassus Equity Fund ("Parnassus") and other purchasers of LeapFrog securities between February 11, 2004 and October 18, 2004. In the July 5 Order, the Court found that "the new claims and new scope of the (Consolidated Complaint) necessitates new notice and lead plaintiff selection." The Court further noted that "(t)he fact that Parnassus claims to be an institutional investor with losses of over $10 million, while the Cupples Movants are individuals with alleged losses of only approximately $36,000 reinforces the conclusion that Parnassus may be better-suited to represent the class under the amended LeapFrog complaint."

The Consolidated Complaint charges LeapFrog and certain of its current and former officers and directors with violations of the Securities Exchange Act of 1934. Specifically, the Consolidated Complaint alleges that the defendants misled investors by making numerous false and misleading statements about LeapFrog's current and future business results, including allegations that LeapFrog falsely claimed to have remedied deficiencies with its supply chain and IT system and allegations that defendants knew that LeapFrog was losing millions of dollars in sales and profits to Mattel's competing PowerTouch product. The Consolidated Complaint further alleges that defendants' false and misleading statements caused the price of LeapFrog stock to trade at artificially inflated prices and took advantage of the artificial inflation to sell millions of their own LeapFrog shares.

After the close of the market on October 18, 2004, and after repeated assurance to investors that LeapFrog would report solid financial results in the third and fourth quarters of 2004 and that the distribution and supply chain problems had been fixed, the defendants announced that LeapFrog's 2004 third quarter results would be significantly worse than the guidance previously provided by the defendants. In response, the price of LeapFrog's stock plummeted $6.21, or approximately 34%, causing class members to suffer actual economic losses.

If you purchased or acquired LeapFrog securities during the Class Period, you may, no later than October 3, 2005, move the court to be appointed as Lead Plaintiff. There are certain legal requirements to serve as Lead Plaintiff.

Any member of the purported class may move the court to serve as Lead Plaintiff through counsel of their choice or may choose to remain an absent class member. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as Lead Plaintiff. To be a member of the class, you need not take any action at this time.

Cohen, Milstein, Hausfeld & Toll, P.L.L.C. has significant experience in prosecuting investor class actions and actions involving securities fraud. The firm has offices in Washington, D.C., New York, Philadelphia and Chicago, and is active in major litigation pending in federal and state courts throughout the nation.

The firm's reputation for excellence has been recognized on repeated occasions by courts which have appointed the firm to lead positions in complex multi-district or consolidated litigation. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. has taken a lead role in numerous important cases on behalf of defrauded investors, and has been responsible for a number of outstanding recoveries which, in the aggregate, total in the billions of dollars.

If you have any questions about this notice or the action, or with regard to your rights, please contact any of the following:

Steven J. Toll, Esq.
Matthew K. Handley, Esq.
Kari Fiore
Cohen, Milstein, Hausfeld & Toll, P.L.L.C.
1100 New York Avenue, N.W.
West Tower, Suite 500
Washington, D.C. 20005
Telephone: [phone] or [phone]
E-mail:  [e-mail] or [e-mail]