There's a shareholders suit to be cleared after settlement with Calvin Klein. Here are the news:
Shareholder Sues Warnaco, Cites Calvin Klein Litigation
23 Aug 08:15
By Colleen DeBaise
Of DOW JONES NEWSWIRES
(This item was originally published late Tuesday.)
NEW YORK (Dow Jones)--A Warnaco Group Inc. (WAC) shareholder sued the apparel
manufacturer, attributing the poor performance of its stock to management
missteps that have resulted in a nasty legal battle with Calvin Klein
Industries Inc. (X.CKI).
The suit, filed Tuesday in Manhattan federal court, also accuses Warnaco of
issuing a series of false and misleading statements from 1997 through this year
on the company's financial success and cash flows.
Warnaco shareholder Anthony K. Newman brought the suit on behalf of
purchasers of Warnaco's shares from Dec. 11, 1997 through July 20, 2000.
In addition, the suit accuses Warnaco Chairman Linda J. Wachner of increasing
her salary, despite the company's lackluster performance, through tactics that
allegedly include securities fraud and unlawful insider sales.
Stanley Silverstein, general counsel for Warnaco, said: "This strike suit has
no merit, and will be vigorously defended in a court of law, not in the press."
Last month, Warnaco's shares fell 27% after the company warned its
second-quarter earnings would fall short of analysts' expectations. The
company's New York Stock Exchange-listed shares fell to a 52-week low of $3.94
on Aug. 1. Since then, the stock has recovered slightly although it is far
short of its 52-week high of $23.81.
Shares closed 4 p.m. trading Tuesday down 3.7% at $4.88.
The company has publicly blamed its recent problems on higher interest
expenses, heavy markdowns to clear out inventory, and low sales due to negative
publicity surrounding its dispute with Calvin Klein.
In May, Calvin Klein filed a lawsuit accusing Warnaco, the maker of its jeans
and underwear, of trademark violation and breach of fiduciary duty. The suit
charges Warnaco and Wachner with "diluting" Calvin Klein's trademark by dumping
off the designer's merchandise to discount retailers.
Warnaco has responded with a counterclaim charging Calvin Klein with
bad-faith dealings and lib%l.
The shareholder suit says Calvin Klein merchandise represents $1 billion in
Warnaco sales and accuses Wachner of placing Warnaco's license and marketing
rights "in material jeopardy" through her alleged misconduct.
The suit also accuses Wachner of leading Warnaco's campaign of false
statements in order to artificially inflate the company's stock. According to
the suit, Wachner sold Warnaco shares at inflated prices for proceeds of more
than $12 million.
The suit seeks an unspecified amount in damages, and a freeze on Wachner's
assets so that claims can paid if the suit is successful.
-Colleen DeBaise, Dow Jones Newswires, 212-227-2017,
colleen.debaise@dowjones.com
(END) DOW JONES NEWS 08-23-00
08:15 AM
Warnaco/Shareholder -2: Suit Also Names Chairman Wachner
22 Aug 17:58
By Colleen DeBaise
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--A Warnaco Group Inc. (WAC) shareholder sued the apparel
manufacturer, attributing the poor performance of its stock to management
missteps that have resulted in a nasty legal battle with Calvin Klein
Industries Inc. (X.CKI).
The suit, filed Tuesday in Manhattan federal court, also accuses Warnaco of
issuing a series of false and misleading statements from 1997 through this year
on the company's financial success and cash flows.
Warnaco shareholder Anthony K. Newman brought the suit on behalf of
purchasers of Warnaco's shares from Dec. 11, 1997 through July 20, 2000.
In addition, the suit accuses Warnaco Chairman Linda J. Wachner of increasing
her salary, despite the company's lackluster performance, through tactics that
allegedly include securities fraud and unlawful insider sales.
Stanley Silverstein, general counsel for Warnaco, said: "This strike suit has
no merit, and will be vigorously defended in a court of law, not in the press."
Last month, Warnaco's shares fell 27% after the company warned its
second-quarter earnings would fall short of analysts' expectations. The
company's New York Stock Exchange-listed shares fell to a 52-week low of $3.94
on Aug. 1. Since then, the stock has recovered slightly although it is far
short of its 52-week high of $23.81.
Shares closed 4 p.m. trading Tuesday down 3.7% at $4.88.
The company has publicly blamed its recent problems on higher interest
expenses, heavy markdowns to clear out inventory, and low sales due to negative
publicity surrounding its dispute with Calvin Klein.
In May, Calvin Klein filed a lawsuit accusing Warnaco, the maker of its jeans
and underwear, of trademark violation and breach of fiduciary duty. The suit
charges Warnaco and Wachner with "diluting" Calvin Klein's trademark by dumping
off the designer's merchandise to discount retailers.
Warnaco has responded with a counterclaim charging Calvin Klein with
bad-faith dealings and libel.
The shareholder suit says Calvin Klein merchandise represents $1 billion in
Warnaco sales and accuses Wachner of placing Warnaco's license and marketing
rights "in material jeopardy" through her alleged misconduct.
The suit also accuses Wachner of leading Warnaco's campaign of false
statements in order to artificially inflate the company's stock. According to
the suit, Wachner sold Warnaco shares at inflated prices for proceeds of more
than $12 million.
The suit seeks an unspecified amount in damages, and a freeze on Wachner's
assets so that claims can paid if the suit is successful.
-Colleen DeBaise, Dow Jones Newswires, 212-227-2017,
colleen.debaise@dowjones.com
(END) DOW JONES NEWS 08-22-00
05:58 PM |
