Vodafone group is facing a class action lawsuit filed by US
shareholders. Europe’s largest mobile phone company is accused of
misleading the market by artificially inflating its share price,
according to statements released yesterday by the US law firms
acting on the shareholders’ behalf.
US firms Milberg Weiss Bershad Hynes & Lerach and
Scott+Scott said yesterday that the suit was filed a week ago and
is pending in a New York district court. The suit alleges that
Vodafone’s senior management issued “a series of material
misrepresentations” to the market highlighting “the company’s
strong financial performance” between 7th March 2001 and 28th May
2002, in order to artificially inflate the price of Vodafone
securities.
The shareholders claim that Vodafone misrepresented, or failed
to disclose that it delayed the write-down of billions of dollars
of goodwill and impaired assets and that it “grossly overpaid for
the numerous acquisitions” it had made in prior years.
Vodafone, which posted a £13.5 billion pre-tax loss for the
financial year ending 31st March, 2002, faces a class action
lawsuit. This means that anyone who bought Vodafone shares between
March 2001 and May 2002 can join the class action in an attempt to
seek damages.
