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Lovell Stewart Halebian LLP Announces Class Action Lawsuit Against NYSE Specialists.

Business Editors/Legal Writers

NEW YORK--(BUSINESS WIRE)--Nov. 18, 2003

The law firm of Lovell Stewart Halebian LLP ((212) 608-1900 or www.lshllp.com) announces that it has filed a class action lawsuit against LaBranche & Co., Bear Wagner Specialists, Spear, Leeds & Kellogg, Van der Moolen Specialists USA, and Fleet Specialist, Inc. ("the Specialist Defendants"), which, as a group, execute transactions in a significant majority of all stocks traded on the New York Stock Exchange. The Complaint asserts claims on behalf of all persons who purchased or sold stocks in transactions executed by the Specialist Defendants ("Class Securities") during the period January 1, 2000 through December 31, 2002 inclusive (the "Class Period"). As defined in the Complaint, Class Securities include the majority of all stocks traded on the New York Stock Exchange during the Class Period. The lawsuit asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated by the SEC thereunder and the common law and seeks to recover compensatory as well as punitive damages. Any member of the class may move the Court to be named lead plaintiff. If you wish to serve as lead plaintiff, you must move the Court no later than December 16, 2003.

The class action lawsuit is pending in the U.S. District Court for the Southern District of New York (500 Pearl Street, New York, New York), and has been assigned to the Hon. Robert W. Sweet, U.S. District Judge. According to the complaint, during the Class Period, the Specialist Defendants allegedly took advantage of their unique access to information regarding orders and trading in their client stocks and their ability to determine the order in which customer orders are executed by engaging in practices including "trading ahead," "interpositioning," and "freezing the book" or going into "report mode." The complaint alleges that by "trading ahead" of customer orders, the Specialist Defendants essentially diverted trading profits from plaintiff and the Class to themselves. The complaint further alleges that by engaging in "interpositioning," the Specialist Defendants caused public investors (including plaintiff and the Class) to incur damages by allegedly depriving them of the sale price for their stock that they would have realized had the Specialist Defendants properly matched orders rather than engaging in interpositioning in order to lock in a riskless profit.

Additionally, the complaint alleges that the Specialist Defendants caused public investors whose orders were placed via the electronic SuperDOT system to incur damages by engaging in a practice known as "freezing the book," which frequently resulted in SuperDOT orders being matched with other orders only after an artificial freeze in trading instituted by the Specialist Defendants. The complaint alleges that when the book was unfrozen, investors' orders placed via SuperDOT were filled at less favorable prices than those at which other orders were filled.

Investors who purchased or sold stocks in transactions executed by the Specialist Defendants on the New York Stock Exchange during the period January 1, 2000 through December 31, 2002 inclusive may contact Lovell Stewart Halebian LLP at the telephone number, address or E-mail address below for more information regarding the class action lawsuit. Investors can also visit Lovell Stewart Halebian's website at www.lshllp.com to view a copy of the complaint.
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Publication:Business Wire
Date:Nov 18, 2003
Words:546
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