I'm not planning to join the "class action suit" but I am considering volunteering as an expert witness for Premier to mitigate any damage. For example, 1) too many people were playing musical chairs and got caught without a chair. "Everyone" knew if the stock stayed over $11.20 long enough there would be a sharp downdraft during the Z warrant call. Those who stayed too long to try to nip an extra point or so or didn't hedge took that risk knowingly. 2) The 10-Q out in February made it clear that accounts receivable was larger than the full quarter's sales, so a lot was shipped in late December but not paid for. That was a red flag that many chose to ignore but Premier put it out for all to see. I could go on, but there's news today.
HSIC filed their 10-Q for the quarter ending March 28, 1998 and it includes:
Item 1. Legal Proceedings
During the first quarter of 1998, the Company became involved in a dispute with Premier Laser Systems, Inc. ("PLS") involving the alleged purchase of certain products distributed by PLS. The parties are discussing a resolution to the dispute. The Company does not believe that this dispute will have a material adverse effect on the Company.
What they meant probably was The Company does not believe that the resolution of this dispute will have a material adverse effect on the Company. They seem to be giving zero possibility to a variety of adverse effects including legal costs, an unfavorable quarterly comparison if they stop selling a product line that contributed to the March quarter revenue, etc. Note, too, what they didn't say. They could have repeated that they deny having ordered any units, but they are filing with careful wording knowing that the resolution is uncertain, but certain wording will piss off Premier and make a resolution and a working relationship with Premier more problematic. I recognize diplomacy.
Anyway, that's what I've heard - Premier and Schein are discussing a resolution. When management at Premier learns to communicate, the stock will recover - how much who knows? Right now, I think they're closed-lipped because of the lawsuits and efforts to certify a class. They've probably been advised that anything they say can and will be used against them, and they are taking a position of letting the SEC filings speak for themselves. For me, there is nothing wrong with putting out pr for the purpose of communicating to stockholders and investors, generally.
<<I'd rather lose my whole investment than be involved in anything having to do with parasitic lawyers. >> I'd rather forego 10 cents on the dollar and pay attention to the company with a positive approach, deciding when to rebuild my position, and not give lawyers a shot at a cash looting of $millions. Anything can happen, but there's enough cash in the company to develop and implement a strategy that makes $5 a share cheap. |
