US law firm, Cauley Geller Bowman Coates & Rudman revealed last Thursday that class action proceedings have begun against chemicals firm, ICI over claims that it misled investors as to its financial situation.
In a statement released last week, Cauley Geller alleged that ICI violated Sections 10(b) and 20(a) of the US Securities Rxchange Act of 1934 by materially misrepresenting its position to the market between August 1 2002 and March 24, 2003.
According to the law firm, throughout the period in question, ICI issued a number of press releases in which it stated that distribution and software problems experienced by the company's Quest food and fragrances division had been resolved, that it was on track to report strong financial results, and that it had not lost any customers as a result of its problems in this division.
However, in March ICI was forced to issue a profits warning following revelations that customers had actually been deserting Quest in droves, leading the company to announce last week that Chief Executive, Brendan O'Neill would be stepping down.
According to Cauley Geller, claims for damages from investors angered by the unexpected 45% drop in ICI's shares this year as a result of its recent troubles could run into 'many millions, possibly tens of millions, of pounds'.
http://www.timesonline.co.uk/article/0,,5-642425,00.html http://www.e4engineering.com/item.asp?id=48471&type=news
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