The investor lawsuit seeking damages for financial losses from alleged stock price inflation by Owens Corning Chief Executive Glen Hiner and four other company officials has moved forward with an appa…
The investor lawsuit seeking damages for financial losses from alleged stock price inflation by Owens Corning Chief Executive Glen Hiner and four other company officials has moved forward with an apparent agreement about who will be lead plaintiff and attorney. Lawyers representing five groups of plaintiffs, all seeking class-action status, had filed separate motions in U.S. District Court in Toledo asking to lead the case. They have now filed a revised joint motion calling for the consolidation of the suits and the appointment of two of the USA“s top securities-litigation firms to act as co-counsel. The plaintiffs contend that Owens Corning officials hid the gravity of company financial difficulties in the year before a Chapter 11 filing in late 2000 in order to inflate the price of the stock. The new motion, which has yet to be approved by presiding Judge David Katz, asks that the case be led by Schiffrin & Barroway, LLP, of suburban Philadelphia, and Schoengold & Sporn, PC, of New York. The two firms have asked for the Toledo, Ohio law firm of Spengler Nathanson PLL to be named as local counsel. Plaintiffs have been given until 8 August 2003 to revise their complaint. The Owens Corning officials being sued will then have until 22 September 2003 to file an expected motion to dismiss the action. The selection of a lead plaintiff has little impact on the ability of affected individuals to collect from any settlement or judgment. However, the designation of lead attorney can mean millions of dollars in contingency fees. Schiffrin & Barroway represents JFK Investment Co. LLC and Icarus Trading Inc., which are claiming USD 700,000 in combined losses from ownership of shares in Owens Corning, which collapsed after filing for bankruptcy protection. Schiffrin & Barroway“s web site says the firm has recovered more than USD 1 billion for clients over the past 15 years. Schoengold & Sporn“s web site lists 17 cases in which the firm has won between USD 3 million and USD 78 million for clients. It represents HGK Asset Management Inc. which contends it lost USD 7 million from its investment in Owens Corning bonds. Another bond-holder suit, involving different issues, is pending against Mr. Hiner and company officials in U.S. District Court in Boston. Judge Katz has asked lawyers to submit a report by 9 July 2003 on the status of that action and any impact it might have on the Toledo suit. Neither action names Owens Corning because lawsuits are barred while firms are in bankruptcy. In the Toledo case, defendants besides Mr. Hiner are Michael Thaman, finance chief and chairman; J. Thurston Roach, former finance chief; Deyonne Epperson, comptroller; and Landon Hilliard, a member of the board of directors who signed some company financial statements. The suit was filed in 2003 on behalf of all shareholders who bought Owens Corning stock between 20 September 1999, and 5 October 2000, a period when the stock value fell sharply.