Court Certifies Class Action Against E*TRADE In Ohio
June 04, 2002 6:31 PM
CLEVELAND -(Dow Jones)- A judge in Cuyahoga County, Ohio has certified a case against E*Trade Group Inc. (ET) as a class action suit, according to the law firm representing the plaintiffs.
In a press release Tuesday, the firm, Webster & Webster LLP, said the decision by Judge Anthony Calabrese of the county's Court of Common Pleas opens the case to all Ohio residents who had an E*Trade account when the company's trading system crashed several times between November 1998 and October 2000.
The firm said the suit, originally filed three years ago, covers as many as 99,000 Ohio residents who had an E* Trade account on the following dates: Nov. 27 and 30, 1998; Feb. 3-5, 1999; March 19, 1999; July 9, 1999; Aug. 10, 1999; Nov. 23-Dec. 3, 1999; Jan. 25, 2000; March 2, 2000; April 3, 2000; May 3, 2000; and Oct. 18, 2000.
The suit alleges E*Trade knowingly expanded its customer base so fast it was unable to handle the projected volume of trades, causing its computers to crash.
E*Trade representatives weren't immediately available to comment.
The charges hearken back to a time of rapid growth at the online trading company. In 2000, E*Trade increased its accounts by 33% during the first three months and saw its number of customers double to 2.4 million during the first six months of the year.
By March 31, 2002, the company had 3.6 million active accounts, but a recession and volatile markets had forced E*Trade - like many of its peers - to cut costs, raise fees, and rethink strategies.
New York Stock Exchange-listed shares of E*Trade recently traded at $5.93, down 11 cents, or 1.8%, on volume of 325,100 shares. Average daily volume is 2,770,483 shares.
-Russ Watkins; Dow Jones Newswires; 201-938-5388
(This story was originally published by Dow Jones Newswires)
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