Three posts from the Yahoo! Dynacq (DYII) thread:
Facsimile of Petition (Part 1)
by: diogenesofthenet 07/07/02 05:06 pm
Msg: 14019 of 14847
[THIS IS A FACSIMILE OF THE PETITION's first few pages. It has not been compared to the original and probably has errors, although an effort has been made to reproduce it with accuracy. The footnotes, exhibits, and subpoena are not included. READ THE ORIGINAL. This has been prepared, via a combination of ICR software and manual corrections, for the convenience of those that do not have access to a copy of the original.]
CAUSE NO. GN202048
IN THE DISTRICT COURT OF TRAVIS COUNTY, TEXAS
VERIFIED PETITION FOR DEPOSITION BEFORE SUIT TO INVESTIGATE
CLAIMS PURSUANT TO TEX. R. CIV. P.202.1
Petitioner Dynacq International, Inc. (Dynacq) respectfu11y petitions this Court for a deposition of Respondent Yahoo! Inc. d/b/a Texas Yahoo! Inc. pursuant to TEX. R. CIV. P. 202.1 :
Parties
1. Petitioner Dynacq is a Nevada corporation with its principal place ofbusiness in Pasadena, Texas). Petitioner is registered to do business in Texas.
2. Respondent Yahoo Inc.. d/b/a Texas Yahoo! inc. ("Yahoo") is a Delaware, corporation that is resident in Travis County. Respondent may be served with process by and through its regi1stered agent for service of process, Corporation .Service Company, 800 Brazos Street, Suite 750, Austin, TX 78701-2554.
3. Pursuant to TEx. R. CIV. P. 202.2(d)(2), Petitioner Dynacq seeks to investigate potential claims it may bring.
4. Yahoo operates Internet message boards, where individuals may make postings under an assumed name on boards dedicated to particular companies. The Yahoo message board for the symbol DYII includes postings regarding Dynacq.
5. The pattern of postings on Yahoo's Dynacq message board on January 16-17, 2002 and February 1-4, 2002, suggests the possibility of an orchestrated campaign to drive down Dynacq's stock price by posting negative messages. Persons with "short" positions in Dynacq stock could take advantage of a temporary, precipitous decline in Dynacq's stock caused by the posting of negative messages as the date for "covering" their short sales approaches.
messages.yahoo.com
Re: Facsimile of Petition (Part 2)
by: diogenesofthenet 07/07/02 05:08 pm
Msg: 14020 of 14847
(continued)
A person who has a "short" position in a stock -- a short seller -- sells that stock at its trading price on the date of sale with an obligation to deliver the stock -- to "cover" the trade --at a date in the future. In essence, the holder of a short position in a stock bets on a decline in the stock price. If the stock price is low on or near the delivery date, the short seller will buy the stock at the low price to satisfy the delivery obligation, thereby making a profit on the difference between the sale price to the purchaser and the short seller's own, lower purchase price.
A short seller can manipulate stock prices through by orchestrating the posting of a high volume of negative messages on Internet boards combined with negative press reports about a stock. The negative postings on Yahoo regarding Dynacq fit this pattern:
(a) Januarv 16-17. 2002. Between January 16, 2002 and January 17, 2002, Dynacq's stock price dropped from $24.30 to $15.07. At the same time, the volume of postings on Dynacq’s message board rose to 314 messages on January 16-17, of which 104 could be considered negative in nature. l By contrast, January 10-1 (fn1) saw 29 messages of which four were negative. This represented a ten-fold increase in message volume and a 25-fold increase in negative message volume.
(b) Februarv 1-4, 2002. Between February 1 and February 4, 2002,Dynacq's share price dropped from $10.99 to $7.62. On February 1, 295 messages were posted, of which 114 were negative in nature. On February 4, 174 messages were posted, of which 92 were negative.2
(c) Simultaneously with the negative postings on Yahoo's message
boards, a negative report regarding Dynacq's stock appeared on the Internet
website, www.thestreet.com, written by columnist Herb Greenberg. Ex. C. Thestreet.com, Inc. has been named as a defendant in a California lawsuit that accuses it of publishing articles as part of a concert of action to"facilitate manipulation of the market for AremisSoft [the Plaintiff company] stock in order to promote profit-taking by short sellers." Ex. D, at 14. That lawsuit specifically accuses Mr. Greenberg of beginning "a series of negative and misleading
electronic news stories about Aremis Soft, which harmed the business and stock value of Aremis Soft.” Id.
(d) various parties held substantial short positions in Dynacq stock.
Reported short positions in Dynacq reached a total 1,145,025 shares as of December 15, 2001, up from of May 15, 2001.
6. Dynacq seeks to determine the identity of the individuals who made postings on the Yahoo message board as part of its investigation of potential claims by it arising out of possible manipulation of its stock price, including but not limited to the following:
(a) Defamation;
(b) Unjust Enrichment
(c) Rule 10b-5, § 10(b) of the Securities Exchange Act of 1934; and
(d) Texas Securities Act, Art. 581-33.
Petitioner therefore requests that the Court set this matter for hearing, and upon hearing, order:
(a) that Respondent Yahoo designate a representative in accordance with the deposition notice attached as Exhibit E to this Petition and served concurrently with this Petition;
(b) all other appropriate relief.
Respectfully Submitted
messages.yahoo.com
Sample of subpoenaed things.
by: diogenesofthenet 07/07/02 05:31 pm
Msg: 14021 of 14847
SUBPOENA DUCES TECUM
1. All documents reflecting or showing the actual identity, including but not limited to the full name, address, telephone number, and employer (if available), of the individual
designated by the author pseudonym "JackRu" on the Yahoo! message board, currently
located on the internet at:
messages.yahoo.com id=5066
2. All documents showing other pseudonyms for the person known as or referred to as
"JackRu" on the Yahoo! internet message board, currently located on the internet at:
messages.yahoo.com id=5066
3.All documents showing the internet service provider for the person known as or referred
to as "JackRu" on the Yahoo! internet message board, currently located on the internet at:
messages.yahoo.com id=5066
[The same three paragraphs repeat with the two differences that are apparent to me. The name of the author and the post, its number being identified by their respective internet address.]
messages.yahoo.com |
