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To: Jeffrey S. Mitchell who wrote (717)	8/31/2000 2:31:45 PM
From: Jeffrey S. Mitchell	Read Replies (1) \| Respond to of 12465

Re: 8/31/00 - [EMLX] MSNBC: FBI makes arrest in Emulex case; California student faces criminal charges FBI makes arrest in Emulex case California student faces criminal charges CNBC STAFF AND WIRE REPORTS LOS ANGELES, Aug. 31 — Officials with the Los Angeles bureau of the Federal Bureau of Investigation made an arrest of a California man Thursday who may be responsible for putting out a fraudulent press release last week about Emulex Corp. August 31, 2000 Emulex CEO Paul Forino speaks to CNBC about the arrest in the stock fraud case that targeted his company. THE SUSPECT, A student, allegedly made $250,000 shorting the stock. Paul Folino, Emulex’s CEO, told CNBC Thursday the suspect was not in any way affiliated with his company. Folino said he and his senior management worked closely with the FBI over the last few days to track down the perpetrator. The CEO said he had no idea why Emulex was chosen as a target. A press conference was scheduled for noon PDT in Los Angeles to discuss the arrest, FBI spokespeople said. “The Los Angeles office had taken the lead in looking for the subject that caused the devaluation of the Emulex shares,” said FBI spokesman Matthew McLaughlin. A fake Emulex press release was posted last Friday on Internet Wire, an online corporate news dissemination service. The misinformation, which was picked up by news services, sent Emulex shares down more than 50 percent, knocking about $2.5 billion off its market capitalization in a matter of hours. After Nasdaq halted trading in the stock, and the company said the information was false, shares recovered nearly all the losses. The bogus release had said the company was forced to restate its earnings, was under investigation by the Securities and Exchange Commission, and that its chief executive had resigned. msnbc.com