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Sacramento, CA – The California State Teachers' Retirement System
today announced the U.S. District Court in Los Angeles has named CalSTRS
lead plaintiff in more than 19 consolidated lawsuits against Homestore.com,
Inc. and several former executives.
“We’re pleased to take on this responsibility to represent
the many who have suffered from unfair dealings by a few,” said Jack
Ehnes, CalSTRS chief executive officer. “Shareholders must actively
pursue these claims to put a spotlight on improper business practices
while seeking recovered lost value.”
Other than reimbursement for court-approved costs and expenses, as lead
plaintiff, CalSTRS will receive no payment beyond the prorated share of
any recovery given to all members in the lawsuit. As lead plaintiff, CalSTRS
will represent the claims of all the shareholders, contract for legal
representation and provide testimony at trial, if necessary.
The first task is selection of a lead counsel firm. CalSTRS has begun
a competitive process for lead counsel services with the successful firm
expected to be named by April 25, 2002. CalSTRS’ selection of lead
counsel is subject to approval by the court.
CalSTRS estimates its Homestore losses at more than $9 million on more
than 431,000 shares from May 4, 2000 to December 21, 2001, the time period
cited in the lawsuits. The suits allege Homestore.com falsified financial
statements and engaged in accounting irregularities.
In addition to Homestore.com, defendants include Stuart H. Wolff, the
company’s former chief executive officer and chair of the board;
Peter B. Tafeen, former chief operations officer; and Joseph J. Shew,
former chief financial officer. All three resigned either immediately
before news of the accounting misrepresentations was released or shortly
thereafter.
CalSTRS served previously as co-lead plaintiff with the Colorado Public
Employees Retirement Association against California Micro Devices. That
suit ended successfully in settlements with the company and the former
chief executive officer.
CalSTRS is the third largest pension fund in the U.S., with a $102 billion
investment portfolio. The pension system serves approximately 687,000
members and benefit recipients by providing retirement, disability and
survivor benefits to California’s public school educators in grades
kindergarten through community college. Those benefits are guaranteed
by law and are not affected by changes in the investment portfolio.
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