SOURCE: Stull, Stull & Brody

July 29, 2005 15:35 ET

Stull, Stull & Brody Announces Class Action Against Guidant Corporation

NEW YORK, NY -- (MARKET WIRE) -- July 29, 2005 -- Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Southern District of Indiana, Indianapolis Division, on behalf of all persons who purchased the publicly traded securities Guidant Corporation ("Guidant") (NYSE: GDT) between December 1, 2004 and June 23, 2005, inclusive (the "Class Period") seeking to pursue remedies under the Securities Exchange Act of 1934 (the "Exchange Act"), against defendants Guidant, Ronald W. Dollens (CEO, President), Guido J. Neels (COO), Keith E. Brauer and Peter J. Mariani.

The Complaint alleges that defendants' positive Class Period press releases and SEC filings were materially false and misleading because: (a) a material portion of the Company's defibrillator products contained life-threatening defects; (b) the unsafe defibrillators presented a material, undisclosed risk to investors; (c) the Company faced tens and potentially hundreds of millions of dollars in unreserved liabilities related to the defective defribrillators, such that the Company's financial statements were not true or accurate or in compliance with Generally Accepted Accounting Principles ("GAAP"); (d) as a result of the significant product defects in Guidant's defibrillators, the Company foreseeably faced a massive, expensive product recall, which would undermine the Company's market credibility, future sales of Guidant products and profitability; and (e) defendants lacked any reasonable basis to claim that Guidant was operating according to plan, or that the Company could maintain its growth in sales of defibrillators in the foreseeable near-term. On June 17, 2005, Guidant announced a recall of approximately 50,000 defibrillators. Then, on June 24, 2005, before the open of trading, defendants announced that it was investigating the safety of certain defibrillator components and advised doctors to "discontinue implants of these devices pending further notice." In reaction to this announcement, the price of Guidant stock fell to $63.90 per share, from $68.60 per share on June 22, 2005, on unusually heavy trading volume. Defendants were motivated to engage in the wrongdoing alleged in the complaint because it enabled Company insiders to sell over 866,515 Guidant shares at artificially inflated prices, for proceeds exceeding $63.5 million.

If you bought the securities of Guidant between December 1, 2004 and June 23, 2005, inclusive, you may, no later than August 23, 2005, request the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Stull, Stull & Brody, or other counsel of your choice, to serve as your counsel in this action. Stull, Stull & Brody has litigated many class actions for violations of securities laws in federal courts over the past 30 years and has obtained court approval of substantial settlements on numerous occasions. Stull, Stull & Brody maintains offices in both New York and Los Angeles.

If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Tzivia Brody, Esq. at Stull, Stull & Brody by calling toll-free 1-800-337-4983, or by e-mail at SSBNY@aol.com, or by fax at 212/490-2022, or by writing to Stull, Stull & Brody, 6 East 45th Street, New York, NY 10017. You can also visit our website at www.ssbny.com.

Contact Information

  • Tzivia Brody, Esq.
    Stull, Stull & Brody
    1-800-337-4983
    Email Contact
    fax 212/490-2022

    6 East 45th Street
    New York, NY 10017
    www.ssbny.com