SOURCE: Kaplan Fox & Kilsheimer LLP

September 16, 2005 17:15 ET

Kaplan Fox Seeks to Recover Losses for Investors Who Purchased DHB Industries Inc. Common Stock

NEW YORK, NY -- (MARKET WIRE) -- September 16, 2005 -- Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com) filed a class action suit in the United States District Court for the Eastern District of New York against DHB Industries Inc. ("DHB" or the "Company") (AMEX: DHB) and certain of its officers and directors, on behalf of all persons or entities who purchased DHB common stock between April 21, 2004 and August 29, 2005 (the "Class Period").

The complaint alleges that during the Class Period, defendants violated Sections 10(b) and 20(a) of the Securities and Exchange Act of 1934 by publicly issuing a series of false and misleading statements. More specifically, the complaint alleges that, throughout the Class Period, defendants issued numerous positive statements about the Company's performance and future prospects that, in fact, were false and misleading. As alleged in the Complaint, these statements were materially false and misleading for the following reasons: (1) the Company's body armor products containing Zylon were potentially dangerous because they could fail to stop bullets due to Zylon-fiber degradation; (2) The Company's financial statements did not reflect the true condition of the Company as they failed to reflect the potential liability the Company would face as a result of the failure of its body armor products containing Zylon and failed to take appropriate reserves for impairment of the value of its inventory; (3) The Company was subject to potentially ruinous liability from regulatory, criminal or civil actions because its body armor products containing Zylon could fail to stop bullets due to Zylon-fiber degradation; (4) The Company's business was dependent, in material part, on the sale of products whose safety was in serious doubt, which, once such potential problems became widely known, would cause a dramatic, if not total, decline in demand; and (5) The Company was at risk that the National Institute of Justice would revoke its certification of DHB's Zylon containing armor, which was required by many of DHB's customers, and that the revocation would have a materially negative impact on its business.

It is also alleged that during the Class Period that certain Company insiders sold millions of their DHB shares, reaping proceeds of more than $213 million.

On August 30, 2005, before the open of trading, DHB issued a press release announcing that it had stopped using Zylon in its body armor after the National Institute of Justice revoked its certification of Zylon-containing body armor. In addition, the Company announced that it would replace all Zylon vests in the field at no cost to the user, and that this replacement program would result in an estimated $60 million charge in the third quarter of 2005. On August 30, 2005, the price of DHB common stock declined $1.56 per share, or 23%, to close at $5.10 per share, on unusually heavy trading volume.

If you are a member of the proposed Class, you may move the court no later November 8, 2005 to serve as a lead plaintiff for the Class. You need not seek to become a lead plaintiff in order to share in any possible recovery.

Plaintiff seeks to recover damages on behalf of the proposed Class and is represented by Kaplan Fox & Kilsheimer LLP. Our firm, with offices in New York, San Francisco, Los Angeles, Chicago and New Jersey, has many years of experience in prosecuting investor class actions and actions involving financial fraud. For more information about Kaplan Fox & Kilsheimer LLP, or to review a copy of the complaint filed in this action, you may visit our website at www.kaplanfox.com.

If you have any questions about this Notice, the action and/or the lead plaintiff motion process, please e-mail us at mail@kaplanfox.com or contact:

Contact Information

  • Frederic S. Fox
    Joel B. Strauss
    Jeffrey P. Campisi
    KAPLAN FOX & KILSHEIMER LLP
    805 Third Avenue, 22nd Floor
    New York, New York 10022
    (800) 290-1952
    (212) 687-1980
    Fax: (212) 687-7714
    E-mail address: Email Contact

    Laurence D. King
    KAPLAN FOX & KILSHEIMER LLP
    555 Montgomery Street, Suite 1501
    San Francisco, California 94111
    (415) 772-4700
    Fax: (415)772-4707
    E-mail address: Email Contact