Here is an article that shows why the company was not notified of the
trading halt until after the stock was halted:
Nasdaq OKs trading halts
In snub to advisors, NASD votes to stop trades without telling company
first
March 25, 1999: 6:19 p.m. ET
NEW YORK (CNNfn) - Officials at the Nasdaq stock market approved a new
rule
Thursday that will let the exchange halt trading of a company's stock
before notifying the company itself.
Overruling its own advisory panel, the National Association of
Securities
Dealers board voted to allow regulators to stop trading any time there
is
news that affects the ability of investors to conduct "fair and orderly"
trades.
Nasdaq said the policy will help regulators react quickly to prevent the
dissemination of partial or false information from causing a stock price
to
swing.
"By removing this sometimes time-consuming requirement, our surveillance
team will be able to act more quickly," Nasdaq President Alfred Berkeley
said in
a statement.
Under previous rules, Nasdaq officials were required to contact the
issuer
of a stock before it could halt trading of shares -- regardless of what
information was driving a price swing.
The Securities and Exchange Commission must approve the NASD-backed
changes.
Last month, Nasdaq's Quality of Markets Committee, an advisory panel of
17
brokers, investors and others in the securities industry, recommended
against such trading halts.
The action comes against the backdrop of a boom in Internet-based stock
trading and the advent of "day trading," in which investors try to cash
in
on small price moves in a security -- often making many trades a day.
The online trading phenomenon has in part fueled a rash of volatility
among
many Nasdaq -- mainly Internet-related -- stocks.
The NASD, the parent company of the Nasdaq, tabled a second, more
sweeping
proposal to allow trading halts at the discretion of exchange officials.
An
NASD spokesman said he did not know when or whether it would come back
up
for a vote.
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